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22 May 2013
Flash: Asia calm ahead of BoJ meeting - BTMU
FXstreet.com (Barcelona) - Derek Halpenny, European Head of Global Markets Research at the Bank of Tokyo Mitsubishi UFJ notes the Asian markets have remained calm ahead of this event with the BOJ maintaining its monetary stance after the end of its two-day monetary policy meeting.
He sees that the BOJ statement confirmed the target of increasing the monetary base by an annual rate of about JPY 60-70 trillion. Further, Board Member Kiuchi continued to object to the defined two-year timeframe for achieving the 2% inflation target. He adds that on the economy the BOJ was more upbeat stating that the “economy has picked up” rather than “the economy has stopped weakening”.
He adds that there was no reference to the JGB market but no doubt the press conference by Governor Kuroda will cover this topic in more detail. Halpenny sees that the key data of note from Asia today was the trade report from Japan, which revealed a larger than expected trade deficit of JPY 879.9 billion in April, some 70% higher than a year earlier and writes, “Exports did improve on an annual basis, by 3.8% but imports also jumped by a larger 9.4%. On a seasonally adjusted basis, exports were unchanged from March while imports fell 2.4%, resulting in a fall in the deficit in April from March.”
He feels that in an indication of where is performing best globally, exports to the US surged by 14.8% from a year earlier, the fourth consecutive annual increase. Exports to Asia jumped 4.3%, with exports to China were up 0.3%, the first positive reading in three months. Exports to the EU fell 3.5% and it was the tenth consecutive trade deficit in Japan and the year-to-date deficit now stands at JPY 3,656bn, compared to JPY 2,056bn in the same period of 2012, a 77.8% increase.
He sees that the BOJ statement confirmed the target of increasing the monetary base by an annual rate of about JPY 60-70 trillion. Further, Board Member Kiuchi continued to object to the defined two-year timeframe for achieving the 2% inflation target. He adds that on the economy the BOJ was more upbeat stating that the “economy has picked up” rather than “the economy has stopped weakening”.
He adds that there was no reference to the JGB market but no doubt the press conference by Governor Kuroda will cover this topic in more detail. Halpenny sees that the key data of note from Asia today was the trade report from Japan, which revealed a larger than expected trade deficit of JPY 879.9 billion in April, some 70% higher than a year earlier and writes, “Exports did improve on an annual basis, by 3.8% but imports also jumped by a larger 9.4%. On a seasonally adjusted basis, exports were unchanged from March while imports fell 2.4%, resulting in a fall in the deficit in April from March.”
He feels that in an indication of where is performing best globally, exports to the US surged by 14.8% from a year earlier, the fourth consecutive annual increase. Exports to Asia jumped 4.3%, with exports to China were up 0.3%, the first positive reading in three months. Exports to the EU fell 3.5% and it was the tenth consecutive trade deficit in Japan and the year-to-date deficit now stands at JPY 3,656bn, compared to JPY 2,056bn in the same period of 2012, a 77.8% increase.