Kazuo Ueda, the BOJ governor, has said repeatedly that no changes are planned to monetary policies for the time being. However, data shows a very different picture. The BOJ announced it was conducting a review of monetary policy, which isn’t expected to be concluded until next year. The central bank has reiterated that there will be no changes until the review is completed. But, it’s not unusual that reality interrupts central bank plans.
In the run-up to tomorrow’s release of the inflation figures, this week brought us a wealth of data from Japan. The majority of these data have been surprising to the upside and caught both analysts as well as policymakers by surprise. In fact, the results have been so positive, Many people believe that Kishida, the Japanese Prime Minister, could call an election.The announcement could be made Sunday after the G-7 meeting held in Japan.
Unexpectedly good GDP results for the first three months of this year were one of the main bits of recent data. Annualized GDP was 1,6%, double what was expected of 0.8%. One of the biggest challenges that the BOJ has been dealing with, and the reason for keeping rates low, is generating “organic inflation”. Although 1.6% annual growth isn’t exactly…