Bank of Japan Expected to Hold Policy This Week

The Bank of Japan started a two-day policy meeting on Monday, with policymakers likely to keep intact the current ultraeasy monetary policy to beat deflation, while discussing the possible impact of a consumption tax hike to be introduced in April.

The nine-member Policy Board is also expected to discuss developments in overseas economies, including the effects of ongoing tension in Ukraine as well as slowing growth in emerging economies, as Japan’s exports appear to lack momentum despite the yen’s depreciation.

Some market participants speculate the central bank may further ease its monetary grip amid lingering skepticism about whether the bank can attain its 2 percent inflation target as it has promised, as the effects of the weak yen pushing up import prices are likely to wane.

But the BOJ has so far remained confident about its scenario, with Governor Haruhiko Kuroda expressing the view that the Japanese economy is on track to achieve the inflation target.

“It is important to steadily promote the current measures,” Kuroda said at an upper house budget committee earlier this month.

The central bank is likely to maintain its assessment of the domestic economy as it has been recovering moderately.

via Mainichi

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza