- BoJ minutes
Minutes of the latest Bank of Japan meeting revealed that policy makers expect the nation's economy to continue its moderate recovery, with the inflation expectations rising as the country continues to combat the deflationary pressures, which have plagued it for more than a decade. Bank of Japan board members at the meeting said that policymakers should focus on the underlying trend in prices, and not just on the monthly moves that market players are keying on, as officials assess whether 2% inflation goal is reachable by 2015. Also, board members said that Japan's exports could be slow to react to developments in overseas economies due to structural changes, such as a shift in production overseas. Members agreed that exports had been weak recently, but exports are likely to recover as overseas economies grow. All in all, minutes offered little clues as to whether the bank intended to further its programme of quantitative and qualitative easing (QQE). The BoJ said it would continue to increase the money supply at the rate of 60-70 trillion yen per year, and would continue with QQE as long as necessary to achieve the price stability target of 2% in a stable manner, adding that the programme had been providing its intended effects.
Meanwhile, Japanese consumer confidence deteriorated for the first time in four months in August, with the sentiment index falling to 41.2, down from 41.5 a month earlier.
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