BOJ December meeting: No change to monetary policy

Author: Eamonn Sheridan | Category: Central Banks

Bank of Japan December 2017 meeting concludes

  • Maintains short-term interest rate target at -0.1 pct
  • Maintains 10-year JGB yield target around zero pct
  • BOJ leaves unchanged pledge to buy JGBs more or less at current pace so its holdings increase at annual pace of around 80 trln yen

Decision on yield curve control made by 8-1 vote, board member Kataoka dissents:

  • Kataoka says need to buy JGBs so yield for duration of 10 years and longer falls
  • Says BOJ should clarify it will ease if domestic factors delay achieving price target
  • Also says he opposed the assessment of consumer prices, says there is a low chance of prices accelerating to 2%

Bank of Japan says Japan's economy expanding moderately, keeps assessment unchanged:

  • BOJ raises assessment on capital expenditure
  • cuts assessment on public works investment
  • raises its view on consumption ... consumption increasing moderately
  • capex continues to increase as a trend
  • public works investment moving sideways at a high level

Headlines via Reuters

I can't see anything much of surprise in that lot. On the last group of bullets, the Bank is getting happier with the progress of the economy. On the second group of bullets, Kataoka is still farily new to the board but I do wonder how many secretly share his view that progress on inflation towards the 2% target is so very slow. Kataoka continues to want more policy action, more stimulus .... to boost progress on inflation.

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Still to come, Bank of Japan Governor Kuroda press conference due at 0630 GMT