Bank of Japan Governor Ueda, headlines via Reuters:

  • When BOJ talks about side-effects of YCC, it includes risk of triggering volatility in markets including for FX
  • Desirable for FX to move stably reflecting fundamentals
  • If YCC heightens FX volatility, that is seen as among side-effects of our policy, when asked BOJ views sharp yen falls as side-effect of YCC
  • Recent high inflation driven by rising import prices and domestic factors, but latter still somewhat weak
  • Hope to see overall inflation slow as cost-push factors dissipate but in medium- to long-run, want to see inflation gradually accelerate
  • Well aware underlying price rises hurting households, companies but don't expect this to last very long
  • When looking at trend inflation there is still some distance toward 2%, which is why we are continuing with massive monetary easing
  • We are continuing to buy huge amounts of govt bonds via market operations so 10-year JGB yield does not too much above 1%

I'm not reading anything here from Bank of Japan Governor Ueda to indicate any reduction in easy policy is imminent.


More market and FX volatility?

not that anything wrong