The BOJ December meeting summary is not suggestive of any urgent pivot

<p>Bank of Japan Summary of Opinions from the December Monetary Policy meeting.<a href="https://www.boj.or.jp/en/mopo/mpmsche_minu/opinion_2023/opi231219.pdf" target="_blank" rel="nofollow"> Full text</a>. </p><ul><li>
One member said must
patiently maintain monetary easing</li><li>
One member said must confirm
sustainable, stable achievement of price target is foreseen in order
to end negative rate, YCC</li><li>
One member said must
scrutinise wage, price moves under YCC given strong upward pressure
on prices likely stabilised</li><li>
One member said even if next
spring's wage hikes are considerably higher than expected, risk that
this will cause underlying inflation to significantly exceed 2% is
small</li></ul><ul><li>
One member said we are not in
situation where we would fall behind the curve in raising rates, even
if we decided to wait after seeing wage talk outcomes next spring</li></ul><p>

I don't want to read too much into all this 'one member' headline commentary. But, if I did then I'd be doubtful of any pivot from the Bank before April, perhaps even later.</p><p>USD/JPY is up a few ticks, circa 142.46 as I update, from142.35 or so just before the release.</p><p>More:</p><ul><li>
One member said steps taken so
far have lowered likelihood of distortion in yield curve, so BOJ has
sufficient leeway to determine whether price target will be achieved
via virtuous wage-price cycle</li><li>
One member said while risk of
inflation becoming too high and requiring rapid monetary tightening
is small, cost incurred if this risk materialises would be
significant</li><li>
One member said timing of
normalising monetary policy is getting closer</li><li>
One member said BOJ should not
miss opportunity to normalise policy to avoid risk of high prices
damaging consumption, achievement of price target</li><li>
One member said looking ahead
toward future exit from current policy, BOJ must examine benefit,
cost of YCC and negative rate policy</li><li>
One member said close
attention should be paid to consumption moves for time being but
given improvement in economy, treatment of YCC, risky asset buying
should be considered thereafter</li></ul><ul><li>
One member said the BOJ's forward
guidance implies that it will allow some tweaks to YCC if achievement
of price target likely to be in sight after implementing such tweaks</li><li>
One member said it is
important for the BOJ to continue deepening discussion on issues such as
timing of exit from current policy, appropriate pace of rate hike
thereafter</li><li>
One member said from
perspective of maintaining confidence in its ability to conduct
monetary policy in exit phase, it is important for BOJ to provide
communication on central banks' balance sheet</li><li>One member said momentum towards wage hikes heightening compared with last year </li></ul><p>—</p><p>Bank of Japan Governor Ueda spoke earlier this week, on 25 December:</p><ul><li><a href="https://www.forexlive.com/centralbank/bojs-ueda-we-will-consider-changing-policy-if-positive-wage-inflation-cycle-strengthens-20231225/" target="_blank" data-article-link="true">BOJ's Ueda: We will consider changing policy if positive wage-inflation cycle strengthens</a></li></ul><ul><li>B<a href="https://www.forexlive.com/centralbank/boj-gov-ueda-said-were-not-there-yet-prospect-of-achieving-price-target-not-high-enough-20231226/" target="_self">OJ Gov Ueda said we're not there yet, prospect of achieving price target not high enough</a></li></ul><p>—</p><p>From the day:</p><ul><li><a href="https://www.forexlive.com/centralbank/bank-of-japan-october-31-statement-full-text-20231031/" target="_self">Bank of Japan October 31 Statement – full text</a></li><li><a href="https://www.forexlive.com/centralbank/usdjpy-jumped-back-to-150-on-the-bank-of-japan-statement-20231031/" target="_self">USD/JPY jumped back to 150 on the Bank of Japan statement</a></li><li><a href="https://www.forexlive.com/centralbank/bank-of-japan-monetary-policy-statement-changes-language-around-1-10year-jgb-cap-20231031/" target="_self">Bank of Japan Monetary Policy Statement: Changes language around 1% 10year JGB cap</a></li></ul>

This article was written by Eamonn Sheridan at www.forexlive.com.