PT Solid Gold Berjangka | BOJ Is Said to See Little Need to End Minus Rate Next Week

00:57 12 December in Fiscal & Monetary, Global, PT SGB, SOLID GOLD BERJANGKA | SOLID GROUP

Bank of Japan BOJ Solid Group, SG Berjangka, PT SGB, Solid Gold Berjangka

Solid Gold Berjangka | The information you provided discusses the Bank of Japan’s (BOJ) perspective on its monetary policy, particularly regarding the negative interest rates. Here are some key points from the text:

  1. Caution on Scrapping Negative Interest Rates: BOJ officials are reportedly not in a rush to eliminate the negative interest rates. The decision is likely to be influenced by the lack of sufficient evidence of wage growth that would support sustainable inflation.
  2. Monetary Policy Unchanged: Despite market speculation that the negative interest rate might be eliminated in the upcoming December meeting, BOJ officials are leaning towards keeping the monetary stimulus settings unchanged at the two-day policy meeting ending on December 19.
  3. Market Impact: The news of the BOJ’s cautious approach caused the yen to extend losses against the dollar. The yen had been down earlier amid market debate about a recent rally.
  4. Market Watch on Federal Reserve: Traders are closely watching the Federal Reserve’s policy outlook, with the expectation that the yen’s further decline could depend on how the Fed characterizes its policy outlook in the Open Market Committee meeting.
  5. Policy Decision Based on Data: The BOJ is expected to make its final policy decision after reviewing all available data, including the Tankan survey due Wednesday and conditions in financial markets up to the last minute.
  6. Speculation on Policy Normalization: Governor Kazuo Ueda’s comment about his job becoming more challenging from the year-end sparked speculation about policy normalization. However, BOJ officials reportedly view this as a general statement rather than a signal of an imminent policy change.
  7. Market Expectations: Earlier market expectations suggested an 8% chance of a rate hike in December, with a 46% likelihood of a move by the end of January. Full policy normalization was priced in by the end of April, according to market indicators.
  8. Economists’ Views: Despite market expectations, economists surveyed by Bloomberg are more cautious, with almost all of them expecting a decision to maintain the status quo in the upcoming meeting. Some economists predict that the negative interest rate could be scrapped in April.
  9. Focus on Subzero Rate: The fate of the subzero interest rate has become a key focus among BOJ watchers, especially after adjustments were made to the yield curve control mechanism in July and October, adding flexibility to the policy.

In summary, the information suggests that the BOJ is likely to maintain its current monetary policy settings in the upcoming meeting, with a cautious approach to scrapping the negative interest rates. Market movements will be influenced by the central bank’s decision, as well as external factors such as the Federal Reserve’s policy outlook.