Bank of Japan leaves rates unchanged, as expectedBank of Japan comprehensive review on past monetary easing stepsUSD/JPY jumps above 155.20 after BoJ votes 8 - 1 to leave rates unchanged again
But if you want a quickie rundown:
Dissenting Vote: Board member Naoki Tamura, a policy hawk, proposed raising rates to 0.5%, citing rising inflationary risks. His proposal was voted down.
Economic Conditions:
Japan’s economy is recovering moderately, with some weaknesses.Consumption is increasing, but uncertainty around U.S. policies and slowing demand in China could weigh on growth.Annualized GDP growth slowed to 1.2% in Q3, with consumption rising a modest 0.7%.Core inflation has fallen from a peak of 4.2% in January 2023 to 2.3% in October.Wage growth, currently at 2.5%-3%, is expected to continue amid labor shortages, supporting the BOJ’s gradual rate hike strategy.
Market Reaction:
The yen initially fell to a one-month low against the dollar before recovering slightly.Investors are watching BOJ Governor Kazuo Ueda’s press conference for clues on the timing of the next rate hike.The BOJ ended negative interest rates in March 2024 and raised its policy target to 0.25% in July.Future hikes depend on wage growth and inflation aligning with the BOJ’s projections.
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USD/JPY up
This article was written by Eamonn Sheridan at www.forexlive.com. Read More Details
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