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16 Mar 2015
What will BoJ have to say about its inflation target? – BBH
FXStreet (Barcelona) - The Brown Brothers Harriman Research Team comments that with BoJ set to meet tomorrow, it is still clear what the central bank might decide to quote regarding its inflation target or 2%, which always have been difficult to reach.
Key Quotes
“The BOJ meets Tuesday. The aggressive monetary easing continues. The boost to inflation has not materialized, and the economy itself continues to disappoint.”
“Growth in the Q4 14 was revised down, but it gives the impression of a lackluster expansion. Last month the BOJ raised its assessment of industrial output and exports.”
“It is still not clear what the BOJ will do with its 2% inflation target for the fiscal year that starts next month. It has always been difficult to see how it was going to be reached.”
“There seems to be a small number of choices for it. It can deny, which is to say it can continue to stick to its target and not acknowledge what is happening.”
“It can downplay the under-shoot, attributing it primarily to the drop in energy prices.”
“It can change its target from FY2015 to something somewhat more ambiguous, like the other central banks do, such as "in the medium term".”
Key Quotes
“The BOJ meets Tuesday. The aggressive monetary easing continues. The boost to inflation has not materialized, and the economy itself continues to disappoint.”
“Growth in the Q4 14 was revised down, but it gives the impression of a lackluster expansion. Last month the BOJ raised its assessment of industrial output and exports.”
“It is still not clear what the BOJ will do with its 2% inflation target for the fiscal year that starts next month. It has always been difficult to see how it was going to be reached.”
“There seems to be a small number of choices for it. It can deny, which is to say it can continue to stick to its target and not acknowledge what is happening.”
“It can downplay the under-shoot, attributing it primarily to the drop in energy prices.”
“It can change its target from FY2015 to something somewhat more ambiguous, like the other central banks do, such as "in the medium term".”