The poll found that the core consumer price index (CPI), which includes oil products but excludes volatile fresh food prices, is expected to fall 0.1% this fiscal year to next March but will rise 0.7% in fiscal 2017, albeit less than half the BoJ’s target.
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Bank of Japan Governor Haruhiko Kuroda is speaking at a final panel session alongside the governor of the Bank of Mexico and the European Central Bank executive board member Benoit Coeure, and the light could be shining nearly exclusively on him – especially after poor inflation data on Friday.
A government report Friday showed that Japan’s consumer prices fell for a fifth straight month in July, underscoring the BOJ’s struggle to spur inflation to its 2 percent target.
The headline CPI dropped an annualised 0.4% in July, the same rate of decline as the previous month and in line with analysts’ estimates.
Economists said the weak inflation data adds to the case for further stimulus measures by the Bank of Japan, which has said it would not rule out another rate cut.
Krippner said that shadow rates are estimated from yield curve data, indicating the degree to which medium- and longer-term rates are lower than would otherwise be expected with a near-zero policy setting.
Federal Reserve Bank of Dallas President Robert Kaplan said the “jury is out” on whether the Bank of Japan’s negative rate policy is working, and monetary policy alone won’t fix the key problems Japan faces.
Kuroda told the Sankei newspaper there is “sufficient chance” of additional easing at next month’s meeting, and officials won’t hesitate to act if necessary.
Meanwhile, the Shanghai composite closed broadly flat at 3,070.47 points and the Hang Seng index edged up 0.41% to 22,909.54.
The People’s Bank of China is set to inject 95bn yuan into money markets through seven-day reverse bond repurchase agreements and an extra 50bn yuan through 14-day reverse repos, Reuters reported.
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In Sydney the S&P/ASX 200 dropped 0.42% to 5,518.70. They heard Fed Chair Janet Yellen on Friday describe future potential options to jump-start the economy while saying that the case for a USA rate hike had strengthened.
