BOJ October Minutes: To keep sustaining Yield Curve Control (YCC) to support wage growth

<p>Bank of Japan October 2023 monetary policy board meeting minutes.</p><p>Headlines via Reuters:</p><ul><li>
Members agreed need to patiently maintain current easy policy</li><li>Several members said
must sustain YCC to continue supporting wage growth</li><li>Another member said
must confirm wage, inflation cycle in determining whether sustained
achievement of price goal can be eyed</li><li>One member said
chance of Japan achieving sustained 2% inflation heightening, BOJ
must gradually adjust degree of monetary easing</li><li>Several members said
Japan's price developments might become factor pushing up long-term
interest rates</li><li>One member said
10-year JGB yield may reach 1% depending on US Treasury market,
domestic price developments</li><li>Many members said
side-effects on markets, corporate funding could become large if the
BOJ keeps tight control on JGB yield</li><li>Several members said
making YCC flexible would help diminish speculative moves in market,
make framework more sustainable</li></ul><ul><li>
One member said BOJ must strongly deny that today's measure is step
toward abandoning YCC, negative rate policy
</li><li>Another member said
steps BOJ took since December last year were aimed at continuing
ultra-loose policy</li></ul><ul><li>
One member said the BOJ must proceed with communication with markets
on chance of Japan's interest rates turning positive</li></ul><ul><li>
One member said achievement of price target already coming into
sight, latter half of current fiscal year is critical period for
scrutinising this</li><li>A member said smaller firms have limited capacity to raise wages</li><li>Several members said there was hope wage growth next year may outpace that of this year</li></ul><p>There is nothing here pointing to a January pivot from the Bank. </p><p>***</p><p>The full text is here:</p><ul><li><a href="https://www.boj.or.jp/en/mopo/mpmsche_minu/minu_2023/g231031.pdf" target="_blank" rel="nofollow">Minutes of the Monetary Policy Meeting on October 30 and 31, 2023 </a></li></ul><p>***</p><p>The tweak at this meeting was to keep the 1% JGB yield ceiling as a point of reference.</p><p>The summary of the meeting was released early in November:</p><ul><li><a href="https://www.forexlive.com/centralbank/boj-october-meeting-summary-20231108/" target="_blank" data-article-link="true">BOJ October meeting summary – USD/JPY little changed in response</a></li></ul><p>From the day of the meeting:</p><ul><li><a href="https://www.forexlive.com/news/the-boj-underdelivers-once-again-20231031/" target="_blank" data-article-link="true">The BOJ underdelivers once again</a></li></ul><ul><li><a href="https://www.forexlive.com/centralbank/bank-of-japan-october-31-statement-full-text-20231031/" target="_self">Bank of Japan October 31 Statement – full text</a></li><li><a href="https://www.forexlive.com/centralbank/bank-of-japan-monetary-policy-statement-changes-language-around-1-10year-jgb-cap-20231031/" target="_self">Bank of Japan Monetary Policy Statement: Changes language around 1% 10year JGB cap</a></li></ul><p>Tags</p>

This article was written by Eamonn Sheridan at www.forexlive.com.