Bank of Japan monetary policy decision and statement for March 2018
BOJ keeps monetary policy steady - as widely expected
- maintains short-term interest rate target at -0.1 pct
- maintains 10-year JGB yield target around zero pct
Decision on yield curve control made by 8-1 vote, board member Kataoka dissents
BOJ removes phrase on expected timing for hitting price goal
BOJ quarterly report:
- Japan's economy expected to continue expanding moderately
- Momentum for hitting price goal sustained but lacking steam
- Inflation likely to accelerate towards 2 pct as output gap improves, inflation expectations heighten
- Risks to the price outlook skewed to downside
- Risks to economy balanced for FY2018 but skewed to downside for FY2019
Core CPI expected +1.8 pct in FY2019/20 vs +1.8 pct projected in January
- Japan core CPI expected +1.8 pct in FY2020/21
- Japan core CPI expected +1.3 pct in FY2018/19 vs +1.4 pct projected in January
BOJ deletes mention of time frame for price target in outlook report
Risks to economy are roughly balanced for fiscal 2018
- risks to economy in fiscal 2019 are to downside
- no big change in price forecast for fiscal 2019
- there are downside risks to prices
- inflation expectations pose both downside and upside risks
- consumer inflation moving around 1 pct
- inflation expectations moving sideways
- inflation expectations likely to heighten ahead and gradually converge towards 2 pct
- impact of sales tax hike next year among risks to economic outlook
Kataoka says need to buy JGBs so yield for duration of 10 years or longer falls further
- says BOJ should clarify it will ease further if domestic factors delay achievement of price target
BOJ's median real GDP forecast for fiscal 2019/20 at +0.8 pct vs +0.7 pct projected in January
- median real gdp forecast for fiscal 2020/21 at +0.8 pct
- median real gdp forecast for fiscal 2018/19 at +1.6 pct vs +1.4 pct projected in January
Quick headlines via Reuters
Full text of statement is here
And, full text of outlook is here
Well, cast your eye over those quick headline takes ... and if you are thinking like me it looks like the BOJ has managed to get itself even more dovish ...
- REMOVES TIMEFRAME FOR PRICE GOAL
- downside risks for the economy and inflation
Yeah ... check out the bit I put in CAPS ....
REMOVES
TIMEFRAME
FOR
PRICE
GOAL
Sheesh .... have they given up now? .... and ... Fuggedaboud the talk of exit ...
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prior to the BOJ announcement there was plenty of data from Japan out earlier:
- Japan Industrial Production (March, preliminary): +1.2% m/m (expected 0.5%)
- Japan - Retail Sales for March: -0.7% m/m (expected 0.0%)
- Japan - Tokyo inflation for April. Headline CPI: 0.5% y/y (expected 0.8%)
- Japan jobs data for March: Unemployment rate 2.5% (expected 2.5%)
Japan's economy is not going along too badly at all.
