Mr JGB, Michio Saito, says thats its possible the Bank of Japan will achieve its stable inflation target this year, but not exactly in the way the central bank envisages:
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“Rather than strong demand pulling up wages and prices through a virtuous cycle, the chronic labor shortage will be the main factor”
Info comes via a Bloomberg report (gated).
- “Japanese long-term yields won’t climb much beyond 1%, even if the Bank of Japan revises its yield curve control program or raises its short-term policy rate,”
- demise of Japan’s negative interest rate won’t be followed by a series of aggressive hikes as seen in the US and Europe
- yields won’t keep shooting up after the initial jump as the central bank will still be offering support for the economy
Saito was director-general of the Financial Bureau at the Ministry of
Finance and is now an executive fellow at Nomura Institute of Capital Markets Research.
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USD/JPY is back around 145.00 to be very little changed on the session
The US dollar is a touch lower pretty much across the major’s board. DXy: