The headline is pretty much what was expected form the Bank of Japan today
CPI forecasts are a focus, here they are … note the cuts:
- Median core CPI forecast for fiscal 2019/20 at +0.9 pct vs +1.4 pct in October
- Median core CPI forecast for fiscal 2020/21 at +1.4 pct vs +1.5 pct in October
- Median core CPI forecast for fiscal 2018/19 at +0.8 pct vs +0.9 pct in Octoebr
BOJ keeps monetary policy steady
- maintains short-term interest rate target at -0.1 pct
- maintains 10-year JGB yield target around zero pct
- leaves unchanged pledge to buy JGBs in flexible manner so its holdings increase at annual pace of around 80 trln yen
- leaves unchanged forward guidance on rates, says will keep current extremely low rates for extended period of time
- decision on yield curve control made by 7-2 vote, board members Harada, Kataoka dissent
- BOJ decides to extend March deadline for lending scheme aimed at encouraging financial institutions to boost lending
- To extend lending scheme for one year
- Japan's economy expected to continue expanding through FY 2020
- economy's momentum for hitting price goal sustained but lacking strength
- risks to price outlook skewed to downside
- risks to economic outlook skewed to downside
- medium- to long-term inflation expectations have been more or less unchanged
- medium-, long-term inflation expectations likely to rise gradually
- decides to extend lending scheme to support growth foundations for another year
- core CPI remains in weak trend compared with economic expansion, tight labour situation
- expect consumer prices to gradually rise towards 2 pct
- overseas economies continuing steady growth as a whole
- expect overseas economies to continue steady growth although must pay attention to us-china trade friction and various recent moves
More forecasts:
- Median real GDP forecast for fiscal 2019/20 at +0.9 pct vs 0.8 pct in October
- Median real GDP forecast for fiscal 2020/21 at +1.0 pct vs 0.8 pct in October
- Median real GDP forecast for fiscal 2018/19 at +0.9 pct vs 1.4 pct in October
And , from the BOJ quarterly report on risks:
- risks to economy skewed to downside, mainly via overseas economic developments
- no sign so far of excessively bullish expectations in asset markets, banks' activities
- prolonged downward pressure on banks' profits from low rates could destabilise financial system
- risk of financial system destabilising not big for now but outlook warrants attention
- regarding the outlook for prices, risks skewed to downside especially concerning developments in medium to long-term inflation expectations
The quick summary headlines are via Reuters. But if you'd like the full text: