The Bank of Japan will take over the folding of incentives until the end of the year

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Today was the scheduled Bank of Japan meeting. The main directions of monetary-credit policy remained unchanged. This applies to yields on 10-year government bonds interest rates on deposits of commercial banks (by the way, minus 0.1%) and volume of asset purchases ($60 billion per month). Inflation target remains at 2%, with a strange perspective in terms of its achievements.
Rumors of cutbacks in the purchase of shares of ETFs and rising bond yields did not materialize, and as a result of trading on the exchanges the dollar strengthened against the Japanese yen up 0.44% and trading at 111,50.
It is clear that such soft power won’t last forever, but changes in regulatory policy will definitely not be sharp. According to the results of today’s meeting of the Bank of Japan announced a flexible attitude to the programme of asset purchases and yields.
Investors can expect the yield on 10-year t-bills will increase to 0.1% and negative interest rates policy will end. The yen strengthened sharply, over a period of devaluation, and begin a new trend on the strengthening of the Japanese currency. Rather, all of this will happen this year.
Expected final growth of the pair dollar/yen to levels 112,20 – 113,20, and then a long decline.
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Vladimir Kuzovlev,
Financial analyst,
Larson&Holz