Start of the new trading week has a sparse economic calendar
Japan Retail sales 7:50 PM ET/2350 GMT:
- Est MoM -0.3% vs 0.4% last
- YoY 0.2% vs 1.3% last
The Bank of Japan will be making their interest rate decision tomorrow, with no change expected from the -0.10% rate. The market will be focused on the forward guidance as inflation remains well below the 2% target (0.6% yoy). The downside risks have increases since the last meeting with export growth under pressure from US trade protectionism. GDP is expected to show modest growth in the 2Q which helps to keep the BOJ steady.
The BOJ may look to extend the expectations for rates to remain steady from the spring to the summer. With inflation not really picking up and global concerns weighing, the hopes for less accomodative monetary policy are more of wish versus a reality (in fact more stimulus may be needed instead especially if the USDJPY should not rebound).
