With hindsight the April meeting was a bit of a placeholder between the rate hike (the first in 17 years) at the March meeting:
Highlights of the Bank of Japan rate decision on April 26, 2024
and
the meeting last week where the Bank flagged a reduction in JGB purchases to come:
BOJ governor Ueda says will begin tapering bond purchases immediately after July meeting
We’ve already had the ‘summary’ of the April meeting:
Bank of Japan Summary – Easy monetary conditions are expected to continueBOJ Summary recap – “BOJ board turned hawkish in April”
Headlines via Reuters:
Member agreed consumption likely to increase moderatelyA few members said
companies might become more active in raising prices, wages than
initially expectedMembers discussed
risks associated with impact of weak yen on inflationOne member said
impact of weak yen on inflation, wages may not prove temporaryOne member said weak
yen could lead to overshoot in underlying inflationOne member said the BOJ must scrutinise without any preset idea the chance firms may renew
efforts to pass on rising import costs via price hikesMembers shared view the BOJ must scrutinise how recent yen falls could affect underlying
inflation
One member said key to future monetary policy outlook would be capex,
consumptionOne member said
there were various upward risks to inflationA few members said
fx is among key factors affecting economy, prices, boj must respond
with monetary policy if outlook and risks change
One member said the BOJ must respond with monetary policy if fx
volatility affects firms’ medium-, long-term inflation expectationsOne member said the BOJ must deepen debate on timing, degree of future interest rate hikes
One member said the BOJ could raise rates moderately before it’s
sufficiently convinced about chance of durably hitting price goal, to
avoid being forced to hike rates rapidly later
One member said boj must raise rates at appropriate, timely manner to
avoid causing stress on economyOne member said
there is sufficient chance pace of policy normalisation could
accelerate if underlying inflation continues to overshoot due in part
to weak yen
more to come
This article was written by Eamonn Sheridan at www.forexlive.com.
