Points to Note from BOJ’s Summary of Opinions
Today in early Asian hours BoJ has released Tokyo Core CPI data with positive numbers (actual -0.2 vs expected -0.3) and along with that BOJ has published Summary of Opinions too. The summary report includes the BOJ’s projection for inflation and economic growth. It’s the primary tool the BOJ uses to communicate their economic and monetary projections to investors.
Key Highlights of the Report:
- Japan’s economy is likely to grow on moderate pace
- The pace of improvement in Japan’s economic developments seems to be somewhat slower
- Business fixed investment and private consumption will lag behind the recovery
- Due to unstable income, downward pressure on consumption may be exerted accordingly
- CPI is likely to be negative for the time being
- For the time being, it is desirable to continue with monetary easing by conducting the three measures.
- BoJ may take additional measures if necessary while closely monitoring the impact of COVID-19
Conclusion: BOJ said a lot on past as well as current economic situation but has not introduced any new measures to boost up the economy. Overall tone was dovish towards monetary policy.
USD/JPY: The Japanese yen trades marginally lower on Tuesday and hovers around 105.50 mark. A sustained close above 105.55 will take the parity higher towards key resistance around 105.90, 106.22, 106.92, 107.48, 107.92, 108.22, 108.54, 109.20 and 109.72 mark respectively. On the other side, a consistent close below 105.38 will drag the parity down towards 104.92, 104.55, 104.20, 103.50 and 102.98 marks respectively.
Take a look and do trade wisely!