The most notable comments from Ueda’s press conference, following the BOJ policy decision earlier in the day:
- Japan’s economy is likely to continue growing moderately
- Underlying inflation is approaching 2% level
- There is risk of underlying inflation overshooting 2% price target
- Japan’s financial conditions have been accommodative
- Will continue to raise policy rate and adjust degree of monetary easing in response to economic activity, prices
- Will consider adjustment timing, pace while looking at likelihood of achieving economic, price outlook baseline scenario
- Stabilising underlying inflation at level around 2% is important; the risks of overshooting are growing
- We believe that the policy phase has changed; short-term objective has changed significantly
- It is getting more important to achieve 2% target more stably
- Not thinking about raising interest rates at a specific timing
- Will assess risks at each policy meeting
He is not yet commenting about the dissents and how that might change things for the BOJ. However, he is reaffirming that they are still on the path on tighten monetary policy further in response to the latest developments in the economy and inflation outlook.
Ueda is not making any pre-commitments on the timing and pace of further rate hikes but he is at least continuing to keep the door open to that for now.
The early comments are reading as though he is not entirely fazed by the dissents from Asada and Sato, which sends an more important message to markets that the BOJ can still act accordingly even if the Takaichi-appointed dissents maintain their current stance.
USD/JPY has fallen down from 157.10 to 156.70 currently, paring some of its earlier gains from the day.
This article was written by Justin Low at investinglive.com.