BoJ: Patience as far as a possible turnaround in monetary policy is concerned – Commerzbank

Over the past weeks, much has been written about the changes in the leadership of the Bank of Japan (BoJ). In the view of economists at Commerbznak, patience seems to be required as far as the BoJ is concerned.

The market is going to consider Ueda’s comments very carefully

“In view of an inflation rate that is high by Japanese standards – it reached 4% in January with the core rate standing at 3% with an upward trend – the market is going to consider Ueda’s comments very carefully. This might lead to erratic moves in JPY. I doubt that these will be sustainable.”

“Only the BoJ decision in early March, still under Kuroda, might provide a first indication as to how monetary policy will develop if Kuroda really was to pave the way for his successor by widening the yield range. Otherwise, we will have to wait patiently until late April when Ueda will be running his first meeting. And even then, it is rather unlikely that Ueda would immediately turn everything in monetary policy inside out.” 

“In this respect, we will probably have to be patient with the BoJ as far as a possible turnaround in monetary policy is concerned.”