Sage Investment Club

There have been plenty of reports suggesting that Japan might look to move towards policy normalisation some time after the summer this year and that even helped to spur bond bears to come back into the picture. Then, we have also gotten quite a few remarks from Kishida in the form of “I cannot confirm nor deny” that any policy change is imminent.

Typically, you might expect Japanese authorities to be firmer about their communique so a change in tone by Kishida even when talking about BOJ governor Kuroda’s successor is something noteworthy. But then, he delivers these remarks today:

So, what is it really he wants markets to think? At this point, I think nothing is certain. A lot will also still depend on the upcoming “Shunto” spring wage negotiations in February and March – before deciding on Kuroda’s successor as well.

In all fairness, all lawmakers and policymakers want is flexibility. That is the option to be right, whichever way things may end up being. After the hot Tokyo inflation data sent the yen up earlier, USD/JPY has pared some losses to stick close to 130.00 now. However, it has been a choppy one since the BOJ policy meeting last week and Kishida’s latest remarks won’t make it any easier to get a grip on things.

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