"Kuroda has made it clear that he's avoiding incremental easing and so far the governor has succeeded in spurring inflationary expectations and changing mind-sets with his one-time, massive measures."
-Long Hanhua Wang, an economist at Royal Bank of Scotland Group
The Bank of Japan kept its monetary policy unchanged and revised up its economic assessment, saying that the economic recovery is underway, due to the positive effect of a weakening Yen and its aggressive monetary stimulus on activity. The central bank made no changes to the forecast that CPI will reach in the coming years the 2% target in the business year ending March 2016. As expected, the BOJ policy makers voted unanimously to keep its pledge of increasing base money at an annual pace of 60 trillion to 70 trillion yen. Many central bankers are encouraged by bright signs in the world's third-largest economy as the nation's currency plummeted to multi-year lows, supporting exporters, as well as optimism generated by Abe's strategy props up consumer spending and business confidence.
Meanwhile, Japan's core machinery orders surged a seasonally adjusted 10.5% on a monthly basis in May to 799.2 billion yen, the Cabinet Office said Thursday, adding to signs that companies speed up their investment plans as the economy recovers. The headline figure rose for the third time in four months and beat economists' expectation of a 1.4% increase from April. On a yearly basis, core machine orders jumped 16.5%, also surpassing forecasts for a 3.3% gain.
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