BoJ policy remains steady - BBH

The BOJ kept policy steady, as expected and only Kataoka voted dissented as he said it was appropriate for BOJ to purchase JGBs so that yields on maturities of 10 years and longer would be even lower, explains the research team at BBH.  

Key Quotes

“Governor Kuroda said inflation pressures have improved in 2017 and inflation is expected to keep rising in 2018.  Decision supports our view that BOJ is in no hurry to tighten and will be the last to exit QE.”  

“Encouraged by higher US yields, the dollar is firm against the yen.  It is testing a trend line drawn off the November high (~JPY114.75) and the high from earlier this month (~JPY113.75), which comes in near JPY113.50 today.   A clean break would set up a test of that November high near JPY114.75.”