The Bank of Japan's monetary policy remained unchanged as the result of November’s meeting. Amid declining prices (which means deflation) and technical recession, the central bank is still positive and optimistic on the near-term prospects of the Japanese economy.
The fact that the key aspects of the BOJ’s monetary policy remained unchanged testify to the fact that the central bank reacted to lower prices and GDP this way. The indexes have been going down for 2 months in a row. Strange as it may seem, the Bank of Japan announced moderate economic recovery once again. Still, the central bankers are concerned about unsatisfactory inflation dynamics seen over the last couple of months.
For now, the Ban of Japan assumes that low oil prices have been the key factor curbing the inflation in Japan, Masterforex-V Academy reports. With that said, the central bankers assume that Japanese prices will stop going down as soon as oil prices stop going down as well. If that’s the case in the near future, the inflation rate will hit the 2% target in late 2016 - early 2017.
FOREX
Meanwhile, it is reported that the Japanese Yen has been showing signs of suspending the mid-term weakness against the U.S. Dollar. Masterforex-V Academy reports that USDJPY has completed wave A/B of level H4. On breaking the 122.61 low, the currency pair will start a bigger-scale bearish move - wave A/B of level Daily.
Key Levels:
Support - 122.22 + 122.40, 121.57/47.
Resistance - 123,75 + 124.62, 125.27 + the top of the descending MF sloping channel.
