- BOJ minutes
There are growing tensions between Bank of Japan members and central bank's governor Haruhiko Kuroda. The latest minutes from the BoJ's meeting during April 7-8 showed that members agreed that consumer spending still remains buoyant following April 1 tax hike, as labour market, and, wages in particular, are improving. One of the members even added that inflation will accelerate from April, as companies used tax revision as an opportunity to pass on higher input costs. Additionally, another member pointed out that the front-loading of domestic demand seen before the tax hike in April was significantly larger than the one that has been observed in 1997, when the government made the similar move. This fact reflects the resilience of consumer spending. What is more important, all members remained univocal on their decision to maintain the annual pace of the stimulus programme at the current level of 70 trillion yen via purchases of government debt and risk assets. The Bank of Japan has stood pat on its monetary policy since launching the unprecedented stimulus programme in April 2013. The latest comments, as well as warning from the Fed and the IMF are decreasing chances we will see additional easing any time soon.
The Japanese Yen benefited from the BoJ minutes, while the deadliest week in Ukraine since the riots began boosted the Yen's safe-haven appeal, pushing the USD/JPY pair lower to 101.43.
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