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12:55 PM · 1 October 2024

USDJPY gains 0.32% amid Japan's PM Ishiba remarks

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New Japanese Prime Minister Ishiba commented today, that the country will carry over former Kishida's economic policy, to ensure Japan makes a complete exit from deflation. Ishiba hopes that 'BoJ maintains easy monetary policy as a trend '. However, Ishiba didn't comment on specific rate policy. However, not every Ishiba's comment was very dovish today.

  • The New PM would like also to maintain accomodative BoJ policy to help low income Japanese households.
  • Despite some investors, raising concerns around potentially 'hawkish' Ishiba stance, today comments put an end to it, signalling no massive 'sea change' in Japanese economy. 
  • However, if deflation trend will finally end (and it's a basic scenario, also according to Ishiba), the bank may be forced to increase interest rates, even despite overall 'dovish' tone and intentions.
  • Ishiba commented also, that Japan will push fiscal policy to help 'deflation ending', focusing on higher wages and investment.
  • Especially the first aspect may be very inflationary, so markets will await more for macro readings from Japan, than for further Ishiba and other BoJ members comments.
 

Source: xStation5

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