The 'Summary' of the Bank of Japan June 2023 meeting was indicative of a change to come at the July meeting:
- Heads up folks, the July (27, 28) Bank of Japan meeting is going to be huge - YCC pivot
- More from the BOJ June meeting summary: One member called for early revision of YCC policy
- USD/JPY lower after the BOJ says CPI may not drop below 2%
- BOJ says strong chance CPI will moderate, but not to back below 2% by mid fiscal year
While the change we got in July was minor, anything new from the Bank of Japan is significant.
Summary headlines via Reuters:
- Members agreed BOJ must maintain current monetary easing to stably, sustainably achieve price target
- Many members said it was appropriate to sustain monetary easing to support changes seen in corporate wage, price-setting behaviour
- One member said it was premature to shift policy at a time companies becoming more keen to boost wages, investment
- A few members said premature policy shift could mean BOJ will lose opportunity to achieve price target
- One member said the chance BOJ is under-estimating sustainability of price rises cannot be ruled out
- One member said BOJ must sustain monetary easing with an eye on side-effects of policy
- Members shared the view no need to make operational tweaks to YCC at this point
- One member said BOJ must avoid as much as possible a spike in interest rates caused from prospects of exit from easy policy
- One member said BOJ must consider reviewing YCC at early stage to avoid big rate volatility upon future exit from easy policy
- A few members said when BOJ were to review YCC, it must be mindful of risk that doing so could be seen by markets as move toward monetary tightening
- Several members said companies continue to pass on higher import costs, raising prices for longer period than expected
- Several members said domestic factors appear to be playing increasing role in pushing up consumer inflation
- One member said must look at medium-, long-term inflation expectations closely as their moves will be key to operating YCC
- One member said there was risk inflation might not fall back below 2%, remain elevated above 2%
- One member said various indicators gauging trend inflation exceeding 2%, so there is chance inflation may not fall back below 2%
- Several members said must be mindful of risk Japan's economy, inflation may come under pressure from US, Chinese, overseas economic slowdown
- Many members said risks to inflation were skewed to upside for time being
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The Bank of Japan meeting Minutes are preceded many weeks in advance by the 'Summary' of the meeting.
- The "Summary of Opinions" provides a concise summary of the views expressed by Policy Board members during the meeting. It does not attribute opinions to individual members but offers a general overview of the views held by the board.
- the Minutes are a more detailed record of the meeting and include an overview of economic and financial developments in Japan, the members' discussions and the reasons behind the decisions made. The minutes offer a more comprehensive account of the meeting, including the perspectives of individual members, which can provide more detailed insights into the policy outlook.
Bank of Japan Governor Ueda
