Friday, September 25, 2015

Japan falls into deflation, stimulus bets rise – Swissquote

FXStreet (Delhi) – Arnaud Masset, Market Analyst at Swissquote, suggests that the Japan’s August inflation report was released earlier this morning and it wasn’t pretty which has raised the hopes for more easing from the BoJ.

Key Quotes

“Despite Kuroda’s boundless optimism, Japan falls back into deflation as the country’s core inflation gauge fell 0.1%y/y from 0% a month earlier.”

“After a promising start in 2013, the economy is running out of steam and seems unable to return to growth without an extra push from the central bank.”

“As a result, we anticipate that the BoJ will increase the size of the stimulus at its annual meeting. Also, we are still bullish USD/JPY on the medium-term, however we do not rule out temporary strength of the JPY on the short-term.”
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