FXStreet (Delhi) – Research Team at RBS, note that the BoJ governor, Mr Kuroda turned up the heat at his press conference last Wednesday by balancing a bullish outlook on domestic demand and the labour market with rhetoric around how the central bank would not hesitate to ease policy further if necessary but the key messages was to strengthen the case for no change at the October 30th meeting, in our view. Key Quotes “The Governor said the economy is getting closer to full employment so he expects more wage growth. He also provided an important hint by saying that the ‘price situation’ (inflation), is different from this time last year when the central bank expanded QQE.” “Finally, he fired a hawkish bullet to end the press conference by saying that a cut to the rate on reserves was not being considered, which is something the market had been discussing.” “The weakness this week came from softer machine orders data, although Japan’s current account for August contracted less than expected, in what has been an encouraging trend for BoJ since the start of last year, well into surplus. Labour cash earnings came in a touch softer, but Kuroda has his eye on the last few promising rounds of shunto wage negotiations.” “In light of our views on the 30th October meeting, we continue to favour Yen longs against Asia regional currencies, particularly SGD and KRW. Furthermore, we like running EUR/JPY shorts on monetary policy divergence as we’re more convinced that ECB will ease further late this year." For more information, read our latest forex news.