BoJ: No fireworks offered – Danske Bank

Analysts at Danske Bank point out that this morning, the Bank of Japan (BoJ) kept its monetary policy unchanged as the policy rate and the yield target on 10-year Japanese government bonds was maintained at -0.1% and 0% (+/-20bp), respectively.

Key Quotes

“The decision was made by a 7-2 vote. The BoJ also maintained its forward guidance and left its asset purchases unchanged.”

“We expect the BoJ to keep its current policy intact until the end of 2019 at least. As we had expected, the BoJ revised down its inflation forecast from 1.1% back in July to 0.9% for FY 18 - so business as usual here.”

“The growth forecast for FY 18 was also cut slightly from 1.5% to 1.4% and risks on the outlook for economic activity and price development are skewed towards the downside.”

“In the current situation, the BoJ is likely to continue to maintain a very accommodative monetary policy for a long period of time.”