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6 Aug 2013
Flash: BOJ preview: Likely to remain on hold - BAML
FXstreet.com (London) - Strategists Masayuki Kichikawa, Shogo Fujita, Shusuke Yamada, Setsuko Yamashita and Shuichi Ohsaki at BofA Merrill Lynch noted the BoJ coming up this week.
Key Quotes:
“The BoJ's next policy meeting is on 7-8 August. We do not expect it to make any changes to its policy framework, such as the base money target, the pace of asset accumulation, or the IOER”.
“The BoJ might need to consider additional easing in three cases: (1) if downside risks increase for the economic growth and inflation outlook; (2) if doubts arise about the effects of its quantitative and qualitative easing, in the form of an unacceptable rise in long-term yields, for example; and (3) if overseas economies falter and the yen appreciates”.
“With no change expected, we look for rates and FX to be range-bound. We favor receiving the belly, like JPY 3y1y, for its good rolldown”.
Key Quotes:
“The BoJ's next policy meeting is on 7-8 August. We do not expect it to make any changes to its policy framework, such as the base money target, the pace of asset accumulation, or the IOER”.
“The BoJ might need to consider additional easing in three cases: (1) if downside risks increase for the economic growth and inflation outlook; (2) if doubts arise about the effects of its quantitative and qualitative easing, in the form of an unacceptable rise in long-term yields, for example; and (3) if overseas economies falter and the yen appreciates”.
“With no change expected, we look for rates and FX to be range-bound. We favor receiving the belly, like JPY 3y1y, for its good rolldown”.