BOJ board member out on the wires
- wholesale prices expected to continue falling for some time due to commodity prices
- consumer prices likely to be around zero for a time due to oil prices
- labour shortages and supply-side constraints tend to constrain economic recovery
- economy likely to emerge from recent pause, grow above potential FY 2016
- doesn't think Japan is in recession
- overseas economies are major downside risk for Japan
Notice how everyone seems to blaming everyone except themselves?
USDJPY 123.48 with supply at 123.50 still providing a cap
- July-Sept GDP could turn out to be positive
- expects capex to peak out in FY 2017 given current growth expectations
- if markets become concerned about limits of BOJ;s JGB purchases risk premium could rise
- sees an increasing risk that Japan investors will want to hold more JGBs, which could make QQE more difficult
- if long term rates rise due to worries about BOJ JGB purchases, impact could be serious
- reducing BOJ's JGB purchases could reduce risks of QE
Glass half-empty still for well-known policy dissenter who has voted consistently for less QE
