Due attention has to be paid to easing side effects.

  • BoJ can impact rates even if JGBs to buy become scarce
  • Can achieve same rate with smaller amount of JGB buys
  • Best yield curve can’t be formed with JGB amount as target.
  • BOJ have to achieve most appropriate interest rate level while keeping side effects to minimum
  • Possible to continue to facilitate formation of yield curve in way deemed most appropriate for achieving 2% price goal.
  • Speech at the Central Banking Seminar Hosted by the Federal Reserve Bank of New York
  • 20 and 30 year JP yields rising a notch to July highs

USDJPY is down 10 pips to 112.92, but not sure if the market takes this as a bit of a watering down of Boj’s resilience,just a bit of USD softness across the boarder again NK threatening an
“unimaginable strike” on US targets as the Korean peninsula drills get underway.
I’ll go fo the latter then .

Full text of the speech can be found here 

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