Monetary Policy press conference 21.12.2017
- Summary of prior (Oct) press conference:- Reiterated that domestic economy is expanding moderately; downside risks to prices are larger – To early to discuss exit from easing policy – Far from price target and no need to change YCC – No need to adjust all easing package at once in the future – Upward pressure on wages growing steadily – Abnormal JPY currency (Yen) appreciation that deviates from fundamentals would hurt the econony and accelerate deflation – Central bank policy differences might affect FX if other factors are the same; BOJ took the most appropriate policy to improve both prices and economy – Normalization will occur when price target is achieved, that is what is happening in both the Fed and ECB – Important for govt to maintain faith on fiscal reform; have not given up on primary budget surplus discipline – Japan debt level is very high – No excessive bullish sentiment in equity market at this time.
- Labour shortage isn’t holding back on economic growth
- Q&A time , in the meantime JPY holding steady 113.43-EURJPY 134.60
- Global economy is expected to continue to grow moderately
- Japan needs to up productivity
- There has been some improvement in prices
- Cost pressure on companies increasing
- Expects pace of price rises to increase in 2018
- No need to review the YCC now
- Doesn’t see problem with financial intermediation in Japan
- My mention of reversal rates did not indicate a change of thinking, no need to change monetary policy for now. (that’s an official denial enough)
- Inappropriate for me to comment on the selection of the next BOJ governor.
- Mon pol since 2013 has created that Japan is no longer in deflation
- Will persistently continue with easing till the 2% infl tgt is met
- ETF purchases part of the policy, not aimed at specific prices levels
- We wont raise rates just because the economy is good
- Will consider adjusting policy if we consider the momentum wanes
Market doesn’t move. The denial was there. No shocks,JPY should remain on the defensive .