Wall St Journal reports, citing people familiar with the BOJ's thinking
The report says that some policymakers see little justification for a rate cut this month, believing the ammunition should be saved for worse economic conditions.
Adding that while matters could quickly take a turn for the worse, BOJ officials believe they now have some "breathing room" with one official quoted as saying "the bank doesn't want to waste its bullets".
The full report can be found here (may be gated).
The yen has slipped a little on the headline with USD/JPY closing in on 108.50 currently but in truth, there isn't any significant pricing for a rate cut by the BOJ for 31 October.
In any case, it is nothing short of ironic that the best way for the BOJ to ease pressure on the economy and the yen is to constantly talk up threats about potential easing i.e. "saving ammunition" or saying that they still have "plenty of tools".
When push comes to shove and the BOJ is forced to draw on its weapons, don't be surprised if they fire blanks.
As such, they are counting on the fear of easing policies being more effective than the easing policies themselves in managing market expectations and sentiment.
