news

한어Русский языкEnglishFrançaisIndonesianSanskrit日本語DeutschPortuguêsΕλληνικάespañolItalianoSuomalainenLatina

“global central bank super week” has come to an end.

after the federal reserve cut interest rates by 50 basis points, the bank of japan decided not to raise interest rates for the time being. on the morning of september 20, the bank of japan announced that it would not raise interest rates for the time being and maintain the policy rate at 0.25%, which was in line with market expectations. the bank of japan unexpectedly announced an interest rate hike at the end of july, raising the policy rate to 0.25%.

just now, the speech of kazuo ueda, the governor of the bank of japan, at the press conference after the meeting released a heavy signal. kazuo ueda said that if the economic and price prospects of japan are realized, the policy interest rate will continue to be raised accordingly. as the recent foreign exchange fluctuations have reduced the risk of price upside, there is still some time for monetary policy decision-making.

japan's inflation situation is also an important reference for the bank of japan's monetary policy choices, and may directly determine the timing of the next interest rate hike. on september 20, the japanese statistics bureau released the price index for august this year. japan's inflation accelerated for the fourth consecutive month, far exceeding the 2% inflation target set by the bank of japan.

the bank of japan announced

on the morning of september 20, the bank of japan announced that it would not raise interest rates for the time being and would maintain the policy rate at 0.25%, in line with market expectations. this interest rate decision was approved by all officials attending the meeting.

prior to this, the bank of japan unexpectedly announced an interest rate hike at the end of july, deciding to adjust the policy rate from 0-0.1% to 0.25%. this interest rate hike decision once caused a sharp drop in global markets, staging a "black monday".

judging from the policy statement, the bank of japan's attitude was optimistic and hinted that it would further tighten policy prudently.

the bank of japan said that despite the impact of rising prices and other factors, private consumption has been on a moderate growth trend, showing that japan's economy is recovering moderately and may achieve growth above potential.

in terms of inflation, the bank of japan said that as the virtuous cycle of "wage-price" gradually strengthens, inflation is expected to maintain an upward trend. it is expected that by fiscal 2025, the growth rate of cpi excluding fresh food will be pushed up.

the bank of japan said that as the output gap gradually improves, long-term inflation expectations will gradually rise as the virtuous cycle of "wage-price" continues to strengthen, basic cpi inflation is expected to gradually rise, and the core inflation rate may gradually rise.

the bank of japan expects inflation to remain roughly in line with the central bank's price target over the three-year forecast period, or until the second half of fiscal 2026.

at the same time, the bank of japan said that uncertainty in economic activities and prices remains high, and in this context, it is necessary to pay due attention to developments in financial markets and foreign exchange markets and their impact on japan's economic activities and prices.

the bank of japan's decision noted that as corporate behavior has recently shifted more toward raising wages and prices, exchange rate movements are more likely to affect prices than in the past.

after the resolution was announced, the yen continued to rise against the us dollar, breaking through the 142 mark, but after the speech by bank of japan governor kazuo ueda, the yen fell against the us dollar in the short term and is now at 142.94.

the gains of the japanese stock market have slowed down. as of the close, the nikkei 225 index narrowed its gains to 1.5%, with the highest intraday gain being 2.21%. the gains of the topix index narrowed to 0.97%.

yusuke matsuo, an economist at mizuho securities, said the yen's movements may have become a more important factor in the bank of japan's decision-making process. he pointed to the bank of japan's recent statement that exchange rate movements tend to have a greater impact on prices than in the past. the bank of japan is also expected to keep its policy rate unchanged again at its october meeting to more closely examine trends in financial markets, the united states and other overseas economies.

kazuo ueda speaks out

at 14:30 beijing time on september 20, bank of japan governor kazuo ueda sent out an important signal in his speech at the press conference after the meeting.

kazuo ueda said that the japanese economy is recovering moderately, although there are some signs of weakness. considering that the current real interest rate is still at an extremely low level, if the japanese economic and price prospects are realized, the policy interest rate will continue to be raised accordingly and the intensity of policy easing will be adjusted.

“if the economy develops in line with our expectations, our thinking that we will continue to raise interest rates has not changed,” ueda said.

ueda kazuo also stressed that he will monitor economic and market trends with great urgency. he said he must pay close attention to financial markets and foreign exchange markets and their impact on the japanese economy and prices.

ueda said there is still some time left for monetary policy decisions as the upside risk of prices has been reduced due to recent foreign exchange fluctuations. the risk of inflation exceeding expectations has weakened to some extent.

ueda kazuo pointed out that there is no specific timetable to confirm the impact of overseas economies on the bank of japan's outlook. it is necessary to closely monitor whether the us economy can achieve a soft landing or face a more severe adjustment. the bank of japan is at a stage where it is deepening its understanding of the neutral interest rate while paying attention to the impact of rate hikes on the economy.

according to a bloomberg survey, 53% of analysts expect the bank of japan to raise interest rates in december, while goldman sachs and bank of america merrill lynch expect the next rate hike to be in january next year.

given the unpredictable nature of financial markets, goldman sachs believes that there is still uncertainty about the timing of the bank of japan's next rate hike. if financial markets fall sharply due to factors such as increased concerns about a us recession, japan's economic activity and price inflation trends may be lower than expected, and rate hikes may be delayed. if economic, wage and price data continue to perform well and financial markets are generally stable, a rate hike in december this year is possible.

bank of america merrill lynch predicts that the bank of japan may raise interest rates again to 0.5% in january 2025, and further raise interest rates to 0.75% in the second half of next year.

katsutoshi inadome, strategist at sumitomo mitsui trust co., expects the bank of japan to raise interest rates by 25 basis points later this year if japan's consumption and economic growth continue to improve.

inflation accelerates in japan

japan's inflation situation is also an important reference for the bank of japan's monetary policy choices, and may directly determine the timing of the next interest rate hike.

on september 20, the japanese statistics bureau released the price index for august this year. japan's inflation accelerated for the fourth consecutive month, far exceeding the 2% inflation target set by the bank of japan.

the latest data shows that japan's cpi rose 3% year-on-year in august, in line with expectations and higher than the previous value of 2.8%. the core cpi excluding fresh food rose 2.8% year-on-year, in line with expectations, accelerating from the 2.7% inflation in july and maintaining at or above the target level of 2% for 29 consecutive months.

overall, the three indicators released by japan in august were in line with expectations, but all rose from the previous month, and the market's expectations for further interest rate hikes by the bank of japan remain. kazuo ueda once emphasized that "if the inflation rate continues to steadily reach its 2% target (as currently predicted by the central bank committee) and wages grow steadily, the bank of japan is ready to raise interest rates further."

among them, since the decline in resource prices last year was greater than this year, the increase in electricity and urban gas fees in august expanded, while gasoline and kerosene were negative, and the overall increase in energy remained unchanged.

japan's cpi excluding fresh food and energy rose 2% year-on-year in august, in line with expectations and up from 1.9% in the previous month.

marcel thieliant, head of asia pacific at capital economics, believes that if japan's underlying inflation rate remains around 2% in the coming months, it will prompt the bank of japan to raise interest rates again at its october meeting.

however, some analysts believe that the fed has made a big turn and the momentum of the global "interest rate cut wave" is increasing. this means that it will have a greater impact on the usd/jpy exchange rate; in this context, the bank of japan may be more cautious in raising interest rates this year.