December 23, 2024 at 09:10PM
There are a couple of meeting minutes scheduled for the Asia session:
for the Bank of Japan meeting on October 30 and 31
for the Reserve Bank of Australia meeting on December 9 and 10
Bank of Japan:
At its meeting on October 30-31, 2024, the Bank of Japan (BOJ) maintained its ultra-low interest rates, emphasizing the need to carefully assess global economic developments before making further policy adjustments.
BOJ Governor Kazuo Ueda highlighted the importance of monitoring economic indicators, particularly from the United States, due to their significant impact on Japan’s economy. He noted that while recent U.S. data had been positive, uncertainties remained regarding the effects of previous rate hikes by the Federal Reserve. Consequently, the BOJ adopted a cautious stance, indicating that any future rate hikes would be contingent upon increased confidence in economic and price forecasts.
The BOJ’s decision to maintain the current policy rate at 0.25% reflects its commitment to supporting Japan’s economic recovery while being vigilant about potential risks from global economic conditions and market volatility. Governor Ueda stated that the central bank would continue to scrutinize data at each policy meeting to determine the appropriate timing for any policy changes.
This cautious approach aligns with the BOJ’s strategy to ensure that any adjustments to monetary policy are well-timed and based on robust economic indicators, thereby avoiding premature tightening that could hinder Japan’s economic progress.
The cautious approach continued at the meeting that followed, December 18.
From the day:
Bank of Japan leaves rates unchanged, as widely expected
From the Summary that followed two weeks after:
BOJ Summary (Oct.): Yen’s depreciation has significant effects
Reserve Bank of Australia:
At its meeting on December 9–10, 2024, the Reserve Bank of Australia (RBA) maintained the cash rate target at 4.35%, marking the ninth consecutive meeting without a change.
In its statement, the RBA noted that while headline inflation had declined substantially, underlying inflation remained above the target range. The Board expressed increased confidence that inflation is moving sustainably towards the target, signaling a potential shift in monetary policy in the near future.
Governor Michele Bullock highlighted that recent economic data had been softer than expected, indicating a possible easing of inflationary pressures. She emphasized that the Board’s views are evolving in response to these developments, opening the door to a potential rate cut as early as February 2025 (although May is the current consensus).
The RBA’s (slightly) softened tone aligns with global trends, as several major central banks have begun easing monetary policies amid concerns over economic growth. The decision to hold rates steady reflects a cautious approach, allowing the Board to assess upcoming economic data before making further adjustments.
From the day:
ForexLive Asia-Pacific FX news wrap: RBA on hold, less hawkish
RBA’s Bullock: I don’t know if we’re going to be cutting rates in February
RBA’s Bullock: We did not explicitly consider an interest rate cut today
RBA’s Bullock: The change in wording today is deliberate
RBA’s Bullock: We need to think carefully about where we’re going on policy
This article was written by Eamonn Sheridan at www.forexlive.com.
