Nov 01 2013
BoJ sticks to inflation target despite board dissent
Takehiro Sato, Takahide Kiuchi and Sayuri Shirai opposed the wording of the price outlook and voted against the report, highlighting the risk that mixed messages from within the board will make it harder for Kuroda to maintain confidence in the campaign to stamp out deflation. While yen weakness and higher energy prices have countered deflation, a 0.7 percent increase in the BOJ’s key price gauge last month showed that the goal of 2 percent inflation remains distant.
“Shirai pointed out the outlook report should reflect more downside risks,” said Naoki Iizuka, an economist at Citigroup Inc. in Tokyo. “That’s a sign that the assessment of Japan’s economy is becoming more difficult. We have more uncertainties compared with April.”
The Bank of Japan maintained its unprecedented easing and forecast inflation will reach its target, even as some board members cautioned that the price outlook was too optimistic.
Rate Range Projection by Bank
Next week 96.00 -98.50
Next 3 months 90.00 - 103.00
The Federal Reserve meets for its October policy meeting anounced that a non-taper of QE3 is expected so the current situation will be remain.