Home / Forex & Currency Exchange News / BoJ holds fire, brightens economic outlook

BoJ holds fire, brightens economic outlook

Article by ForexTime

As widely anticipated the Bank of Japan did not surprise markets by keeping monetary policy unchanged at its final meeting for 2016. The central bank left interest rates unchanged at -0.1% and 10-year JGB’s yield target around zero, while maintain its annual holding of bonds at 80 trillion yen.

The 12% decline in the Yen and 13% surge in crude prices since BoJ last met on November 1, helped in providing a brighter economic outlook as exports and output picked up.

But the extreme divergence of U.S. monetary policy was considered a risk, as series of expected rate hikes in 2017 could see capital flight from emerging economies.

USDJPY rose 0.5% as bond yield spreads between U.S. and Japan are not expected to shrink anytime soon, but we can assume that BoJ’s next step likely to be tightening rather than easing further.

2016 is ending with tragic incidents in Turkey and Germany, but investors have become so fast in digesting bad news, and this explains the resilience in financial markets.

The U.S. dollar is trading in narrow ranges against most of its major peers after Monday’s rally which was supported by Yellen’s public speech in Baltimore University. Although she did not comment on Monetary policy, her views that job market is strong and wage growth picking up was sufficient to provide the greenback a boost.

With only nine trading days remaining till end of year, investors are unlikely to take heavy positions, whether it’s in equity, fixed income or foreign exchange markets, suggesting that the narrow range trading is likely to remain until new year.

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.


Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Click Here For Original Source Of The Article

About Louie Lewis

Louie Lewis
Successful forex trading starts with you first. Then comes the actual strategies and techniques. I have been involved with forex and forex trading for a few years now. It is a wonderful way to build wealth. The learning never stops and I want to help others along their journey into this wonderful market of opportunity.

Check Also

US Dollar Index Speculators reduced their bearish bets this week

US Dollar Index Speculators reduced their bearish bets this week

By CountingPips.com – Receive our weekly COT Reports by Email US Dollar Index Non-Commercial Speculator Positions: Large forex speculators reduced their bearish net positions in the US Dollar Index futures markets this week, according to the latest Commitment of Traders (COT) data released by the Commodity Futures Trading Commission (CFTC) on Friday. The non-commercial futures […]

Leave a Reply

Your email address will not be published. Required fields are marked *

css.php