Bank Of Japan Leaves Policy Unchanged, Upgrades Economic Outlook

With a vote of 7 to 2, The Bank of Japan decide to change nothing about its monetary policy. While expected, some had suggested Kuroda might shift the 10Y target away from 0bps, but no - no change to asset purchases, no change to 10Y target level, and no change to policy rate. However, in what some say is a tilt towards future tightening, The BoJ upgraded its view of the Japanese economy.

  • BOJ keeps monetary policy unchanged, as predicted by all 39 economists surveyed by Bloomberg.
  • BOJ: Japan's Economy Has Continued Moderate Recovery Trend
  • Bank of Japan Keeps 10-Year JGB Yield Target at About 0%
  • BOJ Maintains Policy Balance Rate at -0.100%
  • BOJ statement lists all the usual risks - China, Brexit, uncertainty in the U.S. And, interestingly, it flags worries about euro zone debt and European banks, the crisis that everyone seems to have forgotten (except the BOJ it seems).

There is a small (negative) reaction in yen...

Unusuallym there are no wild-cards in this statement, but as Bloomberg's Brian Fowler notes, the one key takeaway is that BOJ upgrades view of Economy. One more piece of evidence suggesting next move will be toward tightening rather than loosening.