Former Japan Yen intervention boss – BOJ won’t tweak yield curve control (YCC) next week

Mitsuhiro Furusawa is a former Japan vice minister of finance for international affairs. He now heads the Institute for Global Financial Affairs at Sumitomo Mitsui Banking Corp.

The vice finance minister for international affairs is sometimes referred to as Japan’s ‘top currency diplomat’. Japan’s finance ministry is the relevant authority in Japan for ordering intervention in the JPY. The vice finance minister for international affairs is in charge of directing Bank of Japan FX intervention, should it come to that.

Furusawa says that given Bank of Japan Governor Ueda’s comments in India, it’s unlikely that the bank will modify YCC at the upcoming meeting next week, July 27 and 28.

• “In the past I thought July is possible, but the way he’s speaking, if he moves next week, it’ll be a major surprise.”
• said the bank may make a change in September or October
• “The YCC isn’t distorting the bond market or making it difficult to issue bonds at the moment but the bank needs to revisit it, as it’s a fairly irregular policy”

Info via Bloomberg (gated).

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Earlier posts re this:

• Governor Ueda and his officials at the Bank have been … insisting that inflation is transitory and does not necessitate a move away from easy policy

• Bank of Japan Governor Ueda comments this week have watered down YCC tweak expectations
• October is now the month most cited as the likely timing for a BOJ policy change

And, coming from Japan today:

• Economic calendar Asia 21 July 2023 – Final read on Japan inflation data pre-BOJ meeting

This article was written by Eamonn Sheridan at www.forexlive.com. Source