Forex Flash: BoJ would not ease further next week – Danske Bank
FXstreet.com (Barcelona) - Since early March highs above the 84.00 mark, the Japanese yen has been appreciating against the buck, along with increasing concerns regarding the sustainability of the euro zone and the consequent seek for safe havens.
Alarm bells have started to ring in the MoF and BoJ as soon as the cross penetrated the payschological level at 80.00, and with them the famous - albeit ineffective - 'verbal' intervention by the Japanese oficcials.
A.von Mehren and S.Bocian, analysts at Danske Bank, expects the BoJ to stand pat on its next meeting due the following week, although there could be room for a surprise. An issue worth noting is the introduction of two new dovish board members. "Hence the balance on the BoJ board has clearly moved in a more dovish direction".
The experts assess that "We still expect the asset purchase programme to be expanded by JPY5-10trn in October in connection with the release of BoJ's next revision of its growth and inflation forecast and they could both be revised lower. However, should JPY appreciate markedly, monetary easing will be frontloaded and more aggressive".
Alarm bells have started to ring in the MoF and BoJ as soon as the cross penetrated the payschological level at 80.00, and with them the famous - albeit ineffective - 'verbal' intervention by the Japanese oficcials.
A.von Mehren and S.Bocian, analysts at Danske Bank, expects the BoJ to stand pat on its next meeting due the following week, although there could be room for a surprise. An issue worth noting is the introduction of two new dovish board members. "Hence the balance on the BoJ board has clearly moved in a more dovish direction".
The experts assess that "We still expect the asset purchase programme to be expanded by JPY5-10trn in October in connection with the release of BoJ's next revision of its growth and inflation forecast and they could both be revised lower. However, should JPY appreciate markedly, monetary easing will be frontloaded and more aggressive".
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