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What To Expect From BoJ? ... Views From 11 Major Banks

Discussion in 'Market News' started by ForexLive, Oct 7, 2015.

  1. ForexLive

    ForexLive Forum Member

    Sep 2, 2015
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    A preview of the Bank of Japan meeting courtesy of eFX I'm typing this quick so it is, in fact, a preview ... not long to go now! from the April 2016 meeting due to the downward revisions in corporate inflation expectations. While our baseline call is for end-October, we also see a risk of preemptive action as early as at this week's BoJ meeting (Wednesday). increase the annual pace of monetary base expansion to JPY100-110trn from the current JPY80trn, increase JGB purchase to JPY100trn from JPY80trn, extend the average duration of JGB purchases to 9-12y from 7-10y, increase equity-linked ETF purchase to JPY6trn from JPY3trn, and 5) cut IOER by 5bp to 0.05%. While uncertainty remains as to what the BoJ actually undertakes when easing further, a decisive action could pose an upside risk to our USDJPY forecast of 123 at the end-2015. Inaction this week may temporarily weigh on USDJPY, but market expectations for an action on October 30 will likely remain live, limiting the downside for the pair.

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