The Japanese Yen Has Declined Moderately Overview 20.07.2017

The Japanese Yen is somewhat declining against US Dollar on Thursday morning. Currently, the pair holds at 112.09. BoJ has left unchanged the basic parameters of its monetary policy during today's meeting. The basic interest rate has been left unchanged at -0.1% per annum, the asset buying program hasn't seen any changes also and has the same volume of 80 bln Yen a year. The decision was made by majority of voices however there were opposing opinions too. Thus, BoJ's Mr. Kuiti is sure the QE should be reduced to 45 bln Yen a year, while interest rates must be greater than 0. His proposal was declined though.

It is important to pay attention to inflation estimates. The BoJ has changed its mind as to when the target inflation value of 2% will be achieved. The bank has extended the period of time by 2019 fiscal year. Earlier the bank was thinking inflation would hit the target by as early as 2018. This news is not a good one for the Japanese government, for economy and Yen. However, the bank has reviewed its estimates on economy for the better. According to BoJ, GDP will rise by 1.8% this year (previous estimate 1.6%) while in 2018 GDP will rise by 1.4% (last estimate 1.3%).

The market will quickly take into account the data from BoJ and after lunch it will return to news and rumors on the US Dollar.