The Japanese yen rose a bit during Monday’s quiet trading. With no major events or macroeconomic releases, markets were rather directionless today, though the rest of the week promises to be much more eventful.
The Bank of Japan released minutes of its December monetary policy meeting. The notes did not provide many new insights. About the outlook for the economy, the minutes said:
As for the outlook for the economy, members concurred that it was likely to continue its moderate expansion.
Few negative factors were mentioned, though, like the fact that “exports, including those to China, had been weak as a whole” and “firms held cautious views, mainly against the background of the prolonged US-China trade friction.”
About inflation, the notes said:
The year-on-year rate of change in the CPI continued to show relatively weak developments compared to the economic expansion and the labor market tightening.
Nevertheless, the outlook for the future developments was relatively optimistic:
In terms of the outlook for prices, most members shared the view that the year-on-year rate of change in the CPI was likely to increase gradually toward 2 percent, mainly on the back of the output gap remaining positive and medium- to long-term inflation expectations rising.
Released separately, the Monthly Report on the Services Producer Price Index showed an increase by 1.1% in December. Economists had expected the same 1.2% rate of growth as in November.
USD/JPY edged down from 109.54 to 109.40 as of 10:17 GMT today. EUR/JPY traded at 124.84 after opening at 124.92 and falling to the daily low of 124.60. CHF/JPY was about flat at 110.29.
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