Major issue is where to stop raising rates when getting closer to neutral rateBut Japan is definitely far below the uncertain levels of neutral rate nowEconomic indicators to be watched include wages, inflation, service prices, GDP output gapHard to comment on FX impact of stronger yen on economy, pricesThe impact of a stronger yen compared to a weaker yen is an “interesting matter”
There was a bit of a mistranslation there earlier with the initial headline reading:
*BOJ GOV UEDA: DON’T HAVE 0.5% POLICY RATE IN MIND
This has since been corrected to:
*BOJ GOV UEDA: DON’T HAVE 0.5% POLICY RATE IN MIND AS A CEILING
It’s a minor change but a consequential one with a very different meaning. USD/JPY fell as a result from around 152.60 to 152.10 before keeping around 152.30 levels currently – down 0.3% on the day.
From Reuters:
This article was written by Justin Low at www.forexlive.com.
