BOJ June meeting minutes - members agreed must maintain current easy monetary policy

The 'Summary' of the Bank of Japan June 2023 meeting was indicative of a change to come at the July meeting:

• Heads up folks, the July (27, 28) Bank of Japan meeting is going to be huge - YCC pivot
• More from the BOJ June meeting summary: One member called for early revision of YCC policy
• USD/JPY lower after the BOJ says CPI may not drop below 2%
• BOJ says strong chance CPI will moderate, but not to back below 2% by mid fiscal year

• BOJ drops hints of policy change/tweak in July

While the change we got in July was minor, anything new from the Bank of Japan is significant.

Summary headlines via Reuters:

• Members agreed BOJ must maintain current monetary easing to stably, sustainably achieve price target
• Many members said it was appropriate to sustain monetary easing to support changes seen in corporate wage, price-setting behaviour
• One member said it was premature to shift policy at a time companies becoming more keen to boost wages, investment
• A few members said premature policy shift could mean BOJ will lose opportunity to achieve price target
• One member said the chance BOJ is under-estimating sustainability of price rises cannot be ruled out
• One member said BOJ must sustain monetary easing with an eye on side-effects of policy
• Members shared the view no need to make operational tweaks to YCC at this point

• One member said BOJ must avoid as much as possible a spike in interest rates caused from prospects of exit from easy policy
• One member said BOJ must consider reviewing YCC at early stage to avoid big rate volatility upon future exit from easy policy
• A few members said when BOJ were to review YCC, it must be mindful of risk that doing so could be seen by markets as move toward monetary tightening

• Several members said companies continue to pass on higher import costs, raising prices for longer period than expected
• Several members said domestic factors appear to be playing increasing role in pushing up consumer inflation
• One member said must look at medium-, long-term inflation expectations closely as their moves will be key to operating YCC
• One member said there was risk inflation might not fall back below 2%, remain elevated above 2%
• One member said various indicators gauging trend inflation exceeding 2%, so there is chance inflation may not fall back below 2%
• Several members said must be mindful of risk Japan's economy, inflation may come under pressure from US, Chinese, overseas economic slowdown
• Many members said risks to inflation were skewed to upside for time being

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The Bank of Japan meeting Minutes are preceded many weeks in advance by the 'Summary' of the meeting.

• The "Summary of Opinions" provides a concise summary of the views expressed by Policy Board members during the meeting. It does not attribute opinions to individual members but offers a general overview of the views held by the board.
• the Minutes are a more detailed record of the meeting and include an overview of economic and financial developments in Japan, the members' discussions and the reasons behind the decisions made. The minutes offer a more comprehensive account of the meeting, including the perspectives of individual members, which can provide more detailed insights into the policy outlook.

Bank of Japan Governor Ueda