The Bank of Japan’s meeting that will end with a policy announcement Friday is one of the most anticipated gatherings since Governor Haruhiko Kuroda’s debut decision in April 2013 to launch his monetary easing program. Given Kuroda’s history of surprising observers, the spectrum of potential outcomes is very broad.
While only six of 42 economists surveyed by Bloomberg are predicting that Kuroda’s board will expand already-record stimulus this time, others didn’t rule that out. Twenty-nine expect further easing by mid-year. Citigroup Inc., JPMorgan Chase & Co. and UBS Group AG economists are among those giving additional stimulus at this meeting a more than 30 percent chance.
This is the first meeting of 2016 and comes as global market turbulence has intensified expectations for further easing. Since the BOJ’s last meeting in December, oil prices fell to a 13-year low, the yen touched a one-year high, stocks have tumbled about 10 percent this year and the outlook for faster wage growth has waned.
All of these things are obstacles to the BOJ hitting the 2% inflation target by its goal of around the six months through March 2017. The bank could announce a change to the timing of the target Friday.
And one possible wild card: If stimulus isn’t expanded, look for language that hints at the potential for an unscheduled policy move ahead of the next meeting, which won’t be until March 14-15. The BOJ has a new schedule for 2016, and no longer has a February meeting.
Friday’s meeting is the first at which the board will release the outlook report at the same time as the policy decision, which could delay the release past the typical window of between noon and 12.30pm in Tokyo. Later decisions in the past were often associated with policy shifts, but that may not be the case this time.
Kuroda will hold a news conference at 3.30pm in Tokyo.
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While only six of 42 economists surveyed by Bloomberg are predicting that Kuroda’s board will expand already-record stimulus this time, others didn’t rule that out. Twenty-nine expect further easing by mid-year. Citigroup Inc., JPMorgan Chase & Co. and UBS Group AG economists are among those giving additional stimulus at this meeting a more than 30 percent chance.
This is the first meeting of 2016 and comes as global market turbulence has intensified expectations for further easing. Since the BOJ’s last meeting in December, oil prices fell to a 13-year low, the yen touched a one-year high, stocks have tumbled about 10 percent this year and the outlook for faster wage growth has waned.
All of these things are obstacles to the BOJ hitting the 2% inflation target by its goal of around the six months through March 2017. The bank could announce a change to the timing of the target Friday.
And one possible wild card: If stimulus isn’t expanded, look for language that hints at the potential for an unscheduled policy move ahead of the next meeting, which won’t be until March 14-15. The BOJ has a new schedule for 2016, and no longer has a February meeting.
Friday’s meeting is the first at which the board will release the outlook report at the same time as the policy decision, which could delay the release past the typical window of between noon and 12.30pm in Tokyo. Later decisions in the past were often associated with policy shifts, but that may not be the case this time.
Kuroda will hold a news conference at 3.30pm in Tokyo.
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