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14 Feb 2014
Flash: Early BOJ easing viewed less likely - Nomura
FXStreet (Bali) - Expectations for an early BoJ easing declined further among Japanese researchers, according to JCER, notes Yujiro Goto, FX Strategist at Nomura.
Key Quotes
"Expectations for a BoJ easing remain high, but the expected timing is now clearly delayed further. The number of forecasters expecting a July easing (10) is now almost the same as the number of researchers expecting an April easing (11)."
"Since the January meeting, USDJPY has fallen from 104 to around 102, and weaker expectations for a BOJ easing may be one of the reasons behind the decline, on top of non-Japan factors such as a decline in global bond yields."
"A decline in expectations for early easing by end-April was big, as a majority of forecasters now do not expect easing by end-April, but a decline in USDJPY was relatively limited after considering non-Japan factors. We believe the BOJ's inactivity, thanks to a positive economic and inflation outlook, will not be significantly negative for USDJPY."
"As inflation momentum is likely to remain strong for now, expectations for an early easing will decline further, potentially sending USDJPY lower. Nonetheless, we believe the magnitude of a possible fall in USDJPY in response to lower expectations for the BOJ will be limited."
Key Quotes
"Expectations for a BoJ easing remain high, but the expected timing is now clearly delayed further. The number of forecasters expecting a July easing (10) is now almost the same as the number of researchers expecting an April easing (11)."
"Since the January meeting, USDJPY has fallen from 104 to around 102, and weaker expectations for a BOJ easing may be one of the reasons behind the decline, on top of non-Japan factors such as a decline in global bond yields."
"A decline in expectations for early easing by end-April was big, as a majority of forecasters now do not expect easing by end-April, but a decline in USDJPY was relatively limited after considering non-Japan factors. We believe the BOJ's inactivity, thanks to a positive economic and inflation outlook, will not be significantly negative for USDJPY."
"As inflation momentum is likely to remain strong for now, expectations for an early easing will decline further, potentially sending USDJPY lower. Nonetheless, we believe the magnitude of a possible fall in USDJPY in response to lower expectations for the BOJ will be limited."