7 Aug 2013
Flash: BoJ not expected to announce fresh initiatives – UBS
FXstreet.com (New York) - Since Bank of Japan Governor Kuroda unveiled his new QQE policy in April, FX investors have focused almost exclusively on the JGB-side of the program, suggests Research Analyst Gareth Berry at UBS.
Key quotes
“There are good reasons for this, though we should not overlook BoJ operations in the equity space, especially given the tight correlation between USD/JPY and Japanese stocks. Indeed the BoJ bought equity ETFs on Monday and Tuesday this week, briefly propping up the USD/JPY.”
“We do not expect the BoJ to announce fresh initiatives at Thursday's policy decision, especially given the ETF ceiling has already been dropped. However we would not rule out more determined forays into the equity space later this year, perhaps on Oct 31st.”
Key quotes
“There are good reasons for this, though we should not overlook BoJ operations in the equity space, especially given the tight correlation between USD/JPY and Japanese stocks. Indeed the BoJ bought equity ETFs on Monday and Tuesday this week, briefly propping up the USD/JPY.”
“We do not expect the BoJ to announce fresh initiatives at Thursday's policy decision, especially given the ETF ceiling has already been dropped. However we would not rule out more determined forays into the equity space later this year, perhaps on Oct 31st.”