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In its latest client note, Goldman Sachs’s Analysts provided their review on the Bank of Japan (BoJ) monetary policy announced a day before.

Key Quotes:

“Introduced forward guidance, which will effectively maintain the current ultra-low interest rates until the effects of the consumption tax hike scheduled for October 2019 drop out.

In terms of long-term interest rate operations, the BOJ revised its language to tolerate a certain degree of change according to economic and inflation conditions, thereby taking into account market functions.  

Overall, however, our impression is that the BOJ is effectively saying that the road to normalization of interest rates is far off, contrary to prior media reports.”