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Mazen Issa, Senior FX Strategist at TD Securities, points out that the Bank of Japan left all of its policy operations unchanged and introduced a negative tilt to its growth/inflation outlook, though this was largely due to external developments related to trade policy.

Key Quotes

“On inflation, there was little change to the forecast. Crucially, emphasis on the positive output gap remains the key plank to the Bank’s narrative of an uptick in CPI/wages.”

“Benign comments on financial stability, other than they continue to monitor risks, which they deem low at this point. We recommend tracking the BOJ’s dealer survey to gauge prospects of more yield curve flexibility, where the survey has shown an improvement in JGB conditions.”