BoJ April Summary: uncertain global outlook means Bank must continue current easy policy

BoJ BOJ The Bank of Japan (BOJ) is the central bank of Japan. It was established in 1882 and is headquartered in Tokyo.The BOJ's main responsibilities include issuing and managing the country's currency, implementing monetary policy, and ensuring the stability of the financial system. It also acts as a lender of last resort to banks during times of financial crisis. The BOJ sets the interest rate of the country and sets an inflation target, aiming to achieve 2% inflation.The BoO has a long history, with The Bank of Japan (BOJ) is the central bank of Japan. It was established in 1882 and is headquartered in Tokyo.The BOJ's main responsibilities include issuing and managing the country's currency, implementing monetary policy, and ensuring the stability of the financial system. It also acts as a lender of last resort to banks during times of financial crisis. The BOJ sets the interest rate of the country and sets an inflation target, aiming to achieve 2% inflation.The BoO has a long history, with Read this Term Summary of Opinions of the April meeting:

• Must continue current easy policy given uncertainty over global outlook
• Must support wage hike momentum through monetary easing
• Achievement of price target appears to have come into sight but must maintain easy policy for time being given downside, upside risks

• Must ensure that tweak to interest rate forward guidance is not interpreted as sign boj would allow future rate hikes
• BOJ must be not too quick nor late in policy shift, to avoid causing sharp volatility in interest rate moves
• Closely watching outcome of BOJ’s bond market survey as YCC is causing distortion in smooth finance
• BOJ can get input that may prove useful for future conduct of monetary policy by conducting review of past 25-years of its monetary policy
• BOJ should not target specific monetary policy change when guiding policy review to ensure it would be neutral and convincing
• Govt rep says hope BOJ, under new leadership, would continue to work closely with govt and seek to achieve 2% price target in sustainable, stable fashion

• Japan's inflation likely to approach BOJ's price target as wages rise, but it will take time and uncertainty is high
• there is risk that sluggish real wages may push Japan's inflation well below 2% and may not return back to 2%
• Japan's inflation likely to continue rising for time being due to rising labour costs, impact of overseas inflation
• Japan may see wages continue to rise next year due to intense laboure shortage
• This Spring's wage talks led to high wage growth but problem is whether this will be sustained next year and beyond

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As I'm updating this post the yen is not doing much at all. USD/JPY circa 134.05 and thereabouts.

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Full text:

• Summary of Opinions at the Monetary Policy Meeting on April 27 and 28, 2023

From the meeting:

• BOJ maintains YCC band unchanged, tweaks forward guidance

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The Bank of Japan (BOJ) releases a "Summary of Opinions" after each monetary policy meeting. It serves as a record of the discussion and views of the Policy Board members on various economic and financial issues.

Key points about the Summary:

• The summary includes the views of the Policy Board members on economic conditions, both domestically and globally. This includes assessments of economic growth, inflation, and employment trends, among other indicators.
• The summary also outlines the Policy Board members' views on the effectiveness of the BOJ's current monetary policy measures, including interest rate policy, asset purchases, and yield curve control. Members may discuss the pros and cons of these policies and their potential impact on the economy.
• The summary includes discussions on the outlook for monetary policy and the potential risks to the economy. Board members may express their views on the appropriate timing and direction of future policy changes, as well as the potential impact of external factors such as global economic conditions.
• The summary also includes any dissenting views among the Policy Board members. If a member disagrees with the majority view on a particular issue, they may express their own opinion and rationale.

In a few week's time we'll get the Minutes of this meeting. The Minutes are a more detailed record of the discussions and decisions made during the meeting.

• The Minutes include a more complete record of the views expressed, including any dissents or alternative opinions that may not be included in the summary.
• The Summary of Opinions is typically released a few days after the policy meeting, while the Minutes are published about a month later. This means that the Summary of Opinions can provide more up-to-date information on the BOJ's current stance and view on the economy and monetary policy.
• The Summary of Opinions is usually written in a more accessible language, making it easier to understand the BOJ's views on monetary policy.
• The Minutes, on the other hand, are often more technical and may require a deeper understanding of economics and financial markets.
• The Summary of Opinions is typically shorter than the Minutes.