With the BOJ last week releasing their Monetary Policy Statement followed by the Minutes on Monday, I thought I’d give this week’s Sunday preview, a bit of a Japanese edge.
On Wednesday the Bank of Japan held off any fresh stimulus and left it’s monetary policy unchanged:
Yes this was widely expected by economists, but talk is that the BOJ may have it’s hand forced later in the year as they further cut back on their inflation and growth expectations.
Kuroda dismissed concerns that a falling JPY could hurt the country’s economy as he kept monetary policy on hold. Speaking at a press conference after the meeting, Kuroda was quoted as saying:
There is not enough new information on the economy to justify a change of policy.
This is their official stance but there are real concerns about the strength of a so called recovery and fundamentally we’re looking down the barrel of more QE and the JPY weakening further still.
Read into it all what you will. This is Japan after all.
USD/JPY Daily:
From a technical point of view, last week price popped out of the triangle that EVERYONE had their eye on but the rally wasn’t sustained and we pulled back to retest previous resistance now as support.
We are now sitting at support and the fundamental Japanese story above supports the technicals calling for further gains in the pair.
Dane Williams – @danewilliamsau
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