The Bank of Japan might have to intervene again soon, says BTMUFJ, if other major central banks, like the Fed, aggressively ease monetary conditions. Expectations are mounting that the Japanese central bank will announce additional bond purchases totalling up to JPY5-JPY10 trillion at its next meeting Dec. 20. "The BoJ faces a difficult task to out ease the Fed who are likely to signal monthly QE purchases of $85.0 billion a month in 2013 which could result in total purchases of just over $1.0 trillion," the Bank of Tokyo-Mitsubishi UFJ says. Adds this will require the BOJ to shift to a significantly more aggressive monetary stance to drive a sustainable USD/JPY uptrend next year. "Most likely they will have to resort to the potentially more controversial option of foreign asset purchases akin to direct intervention to weaken the yen in these circumstances given ongoing monetary easing by other central banks." USD/JPY now at 82.39.
Find us on Google+
No comments:
Post a Comment