The new governor of the Bank of Japan, Kazuo Ueda, is providing more commentary on Friday as he participates in his first news conference following the monetary policy meeting.
Key phrases
The external, cost-push variables that contribute to Japan’s headline CPI of 3.5% cannot be managed by monetary policy in Japan.
No comments on changes or levels in stock prices.
Strong worldwide inflationary pressures and supply shocks brought on by the coronavirus have reached Japan.
It is more challenging to respond to inflation undershoot following an early rate increase than to inflation excess.
Risk of extreme inflation overshoot with slow policy reaction is ‘not zero’, but there is also risk of inflation undershoot with hurried monetary normalization.
Consumption and capital expenditures may benefit from rising stock and other asset prices, but there is a danger of harm from “going too far.” Will take into account including a more thorough risk description in policy documents.
On Japan CPI Market Reaction
In response to Ueda’s dovish comments, The USDJPY has increased to retest multi-month highs near 141.40. The price of the pair has increased by 0.63% to 141.20.
https://voiceoftraders.com/analysis/usdjpy-gains-bids-to-regain-its-intraday-high-due-to-the-boj
