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8 Aug 2014
BoJ preview: Downward revision to GDP growth? - RBS
FXStreet (Bali) - RBS reviews the upcoming BoJ monetary policy decision, noting that the Central Bank will most likely stand firm in its expectations for prices to rebound toward target levels.
Key Quotes
"The Bank of Japan will decide on monetary policy and we anticipate a largely unchanged stance. The Bank may reference in its Statement on Monetary Policy that the recent data show GDP growth in the second quarter fell more sharply than anticipated after the consumption tax hike took effect on April 1st."
"A downward revision to GDP growth is likely when the BoJ releases a wholescale revision to its forecasts in the October Outlook Report. Still, our economists feel the BoJ will stand firm in its expectations for prices to rebound toward target levels over its forecast horizon, despite recent weakness in growth momentum. That may prove a disappointment to those anticipating weaker growth increasing the likelihood of more monetary policy easing."
Key Quotes
"The Bank of Japan will decide on monetary policy and we anticipate a largely unchanged stance. The Bank may reference in its Statement on Monetary Policy that the recent data show GDP growth in the second quarter fell more sharply than anticipated after the consumption tax hike took effect on April 1st."
"A downward revision to GDP growth is likely when the BoJ releases a wholescale revision to its forecasts in the October Outlook Report. Still, our economists feel the BoJ will stand firm in its expectations for prices to rebound toward target levels over its forecast horizon, despite recent weakness in growth momentum. That may prove a disappointment to those anticipating weaker growth increasing the likelihood of more monetary policy easing."