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3 Mar 2015
BoJ to step up easing at the July meeting – Barclays
FXStreet (Barcelona) - The Research Team at Barclays, notes that BoJ is likely to step up its monetary easing stance via ETF purchases at its July meeting, and further comment on the effect of the weaker Yen on exports.
Key Quotes
“A puzzling anomaly in the behaviour of exporters may call for a reconsideration of the policy mix in Japan. While we expect the BoJ to step up the monetary easing stance moderately at the July meeting with ETF purchases, we believe Abenomics may benefit more from a wage stimulus and, hence, do not look for the bank to support further yen weakness.”
“Mysteriously, export prices in foreign currency denomination have dropped only 6% since USDJPY was ranging around 80. This explains why export volumes remain fairly unchanged despite the much weaker yen.”
“Japan is not experiencing a competitive depreciation; therefore, the global implications of Abenomics have been fairly muted.”
“Japan is neither exporting deflation nor gaining global market share, a reason why USDKRW continues to trade at pre-Abenomic levels even as the yen has lost 50% of its value against the USD.”
Key Quotes
“A puzzling anomaly in the behaviour of exporters may call for a reconsideration of the policy mix in Japan. While we expect the BoJ to step up the monetary easing stance moderately at the July meeting with ETF purchases, we believe Abenomics may benefit more from a wage stimulus and, hence, do not look for the bank to support further yen weakness.”
“Mysteriously, export prices in foreign currency denomination have dropped only 6% since USDJPY was ranging around 80. This explains why export volumes remain fairly unchanged despite the much weaker yen.”
“Japan is not experiencing a competitive depreciation; therefore, the global implications of Abenomics have been fairly muted.”
“Japan is neither exporting deflation nor gaining global market share, a reason why USDKRW continues to trade at pre-Abenomic levels even as the yen has lost 50% of its value against the USD.”