The BOJ Summary of Opinions from the last monetary policy meeting on July 27/28th

<p>Below are the summary of pages from the Bank of Japan's joyous trade decision</p><ul><li>One member said BOJ needs to patiently continue with monetary easing toward achieving the price stability target.</li><li>One member said there is still a significantly long way to go before revising the negative interest rate policy, and the framework of yield curve control needs to be maintained.</li><li>One member said strictly capping 10-year Japanese Government Bond (JGB) yields at the 0.5 percent level could affect the functioning of bond markets and the volatility in other financial markets.</li><li>One member said given that there are increasingly significant upside and downside risks to the outlook for prices, it is appropriate for the bank to conduct yield curve control with greater flexibility in order to respond to these risks.</li><li>One member said the bank should conduct yield curve control with greater flexibility and thereby make preparations, so that it can successfully continue with monetary easing while nimbly responding to both upside and downside risks.</li><li>One member said until the likelihood of achieving the price stability target rises sufficiently, the bank needs to maintain yield curve control while conducting it with greater flexibility.</li><li>One member said in order to ensure that monetary easing can be continued smoothly for as long as necessary, it is desirable that the bank increase the flexibility of yield curve control to a certain extent in advance while it is able to do so.</li><li>One member said to ensure monetary easing can be continued smoothly for as long as needed, it is desirable to increase flexibility of yield curve control to a certain extent in advance while it is able to do so without turmoil.</li><li>One member said achievement of 2% inflation in a sustainable and stable manner seems to have clearly come in sight.</li><li>One member said while conducting yield curve control with greater flexibility as a preventive measure against future risks, the bank should maintain its basic stance that it will continue with monetary easing.</li><li>One member said allowing to some extent a rise in long-term interest rates in response to the price environment will make real interest rates stable and enable BOJ to contain side-effects.</li><li>One member said it is appropriate for BOJ to conduct monetary policy that is designed to give consideration to market functioning while maintaining accommodative financial conditions.</li><li>One member said in conducting yield curve control with greater flexibility, it is important to let rates be determined by markets as much as possible, prevent sharp fluctuations in rates.</li><li>MOF rep said govt considers that the proposals made at this MPM are aimed at enhancing the sustainability of monetary easing.</li><li>MOF rep said govt expects BOJ to conduct appropriate monetary policy toward achieving price stability target in a sustainable and stable manner while closely cooperating with govt.</li><li>Cabinet Office rep said BOJ must carefully explain to the public its intention regarding changes proposed at this meeting.</li><li>One member said as signs of change have been seen in firms' wage- and price-setting behaviour, close monitoring is warranted on their effects on prices.</li><li>One member said determining whether wage hikes will continue next year will be a key issue.</li><li>One member said prices could deviate upward from BOJ's baseline scenario as firms' moves to pass on cost increases become widespread.</li></ul><p><a href="https://www.boj.or.jp/en/mopo/mpmsche_minu/opinion_2023/opi230728.pdf" target="_blank" rel="nofollow">CLICK HERE </a>for the full report</p>

This article was written by Greg Michalowski at www.forexlive.com.