Goldman Sachs on the Bank of Japan July 31 monetary policy announcement yesterday
This in brief from a client note (bolding mine):
- introduced forward guidance, which will effectively maintain the current ultra-low interest rates until the effects of the consumption tax hike scheduled for October 2019 drop out
- In terms of long-term interest rate operations, the BOJ revised its language to tolerate a certain degree of change according to economic and inflation conditions, thereby taking into account market functions.
- Overall, however, our impression is that the BOJ is effectively saying that the road to normalization of interest rates is far off, contrary to prior media reports.
GS with a summary of the updates to the BOJ 'Outlook':
