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15 Jan 2015
BoJ may extend its easing programme soon - SG
FXStreet (Barcelona) - Kit Juckes of Societe Generale shares that with inflation expectations falling back in Japan, rising BoJ’s concerns indicate that it may extend its monetary easing and lending programmes soon.
Key Quotes
“The weak US retail sales data and falling yields generally, took USD/JPY down to within a whisker of breaking 116 yesterday.”
“the widening real interest rate differential that helped propel USD/JPY higher in 2013 is in danger of being reversed as Japanese inflation expectations fall back. That would be a big concern to=for the BOJ, and maybe its no surprise that we are reminded this morning that the BOJ may extend monetary easing and lending programmes soon.”
“The upshot today has been a bounce in USD/JPY and in the Nikkei after oil prices bounced from a low of $44/b (WTI) to almost $50. But before the next leg of the USD/JPY uptrend can be unleashed, I’d like to see either concrete BOJ action or some movement in those relative (real) rates.”
Key Quotes
“The weak US retail sales data and falling yields generally, took USD/JPY down to within a whisker of breaking 116 yesterday.”
“the widening real interest rate differential that helped propel USD/JPY higher in 2013 is in danger of being reversed as Japanese inflation expectations fall back. That would be a big concern to=for the BOJ, and maybe its no surprise that we are reminded this morning that the BOJ may extend monetary easing and lending programmes soon.”
“The upshot today has been a bounce in USD/JPY and in the Nikkei after oil prices bounced from a low of $44/b (WTI) to almost $50. But before the next leg of the USD/JPY uptrend can be unleashed, I’d like to see either concrete BOJ action or some movement in those relative (real) rates.”