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BoJ monetary policy reaction from Nikko AM

Following the Bank of Japan’s Monetary Policy Meeting, John Vail, chief global strategist at Nikko, one of Asia’s largest asset managers, comments: 

“Not much was expected from today’s meeting, which proved accurate. The BOJ cut this year’s GDP forecast due primarily to auto production problems, but raised next year’s and actually cut its Core CPI forecast for this year. However, it maintained its Core CPI forecast for 2022 and 2023 at around 1%.

“It confirmed the rather obvious improvement trend in the economy in the short term, as most all social restrictions were recently lifted, but remains very cautious about the future, especially as it believes COVID risks remain significant this winter.

“The equity bond and FX markets will not likely move too much on this news.”

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