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
    Likes Received:
    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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