- Japan’s economy is recovering moderately albeit with some weakness
- Economic growth likely to be modest as trade policies lead to slowdown in overseas economies, decline in corporate profits
- How overseas economies and price reacts to trade policies remain highly uncertain
- Important to judge whether outlook will be achieved without any preconception
- Takata and Tamura dissented to BOJ’s quarterly report
- Takata proposed to add a line about inflation reaching price stability target
- Tamura proposed to add a line on underlying inflation being largely in line with target
While there is a heavy focus on the aftermath of Trump and Xi’s meeting, let’s not forget there was also the BOJ decision earlier today here. No rate hike today will continue to seed doubts about a move in December, that especially as Takaichi’s influence as prime minister will grow in the months ahead. Amid her policy intentions, the kind of fiscal “firepower” that she may unleash reduces the pressure for the BOJ to tighten policy in the short-term. Thus, the central bank has less incentive and urgency to act for the time being.
This article was written by Justin Low at investinglive.com.