Technical Analysis

Nikkei reports that Japan PM Kishida will review price target accord with next BOJ chief


Eamonn Sheridan

We’ve been posting on this for months now while its moved from hints and speculation and entered into the ‘done deal’ realm.

Nikkei:

  • The Japanese government must talk with the next Bank of Japan governor about whether to rework the joint accord setting a 2% inflation target, Prime Minister Fumio Kishida said on a radio program that aired Tuesday.
  • “We’ll build a relationship of trust with the new governor and confirm how we will work together,” Kishida said.
  • The radio program was recorded Dec. 19, just before the BOJ’s surprise decision to widen its target band for long-term interest rates in a move that many market watchers see as laying the groundwork for a pivot to less accommodative policy.

Bank of Japan Governor Kuroda’s term finishes up on April 8. A new agreement between Japan’s government and the Bank of Japan would pave the way for a dilution of the current ultra-easy BOJ monetary policy and would be yen-supportive at the margin.

USD/JPY update:

Japanese markets open today after their NY break.

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