The Bank of Japan (BoJ) board members shared their views on the monetary policy outlook on Wednesday, per the BoJ Minutes of the September meeting.     

Key quotes

Members agreed high uncertainty on trade policy developments, impact on economy.

Some members maintained current monetary policy to scrutinise trade policy impact on domestic, overseas economy, prices.

One member stated BOJ should bolster economy with monetary policy, which will likely stall temporarily due to impact of US tariffs.

One member said it won't be too late to look a bit more at hard data in proceeding with rate normalisation

Another member said conditions for rate hike gradually falling into place, but should avoid surprising markets by hiking rates now.

Another member mentioned it may be good time to resume rate hike as over half year has passed since last hike, though can hold for now due to lack of clarity on degree of slowdown in US.

One member said important to predict with some certainty, based on corporate profits and pre-information on wage negotiations, that wage-hike trend seen in past few won't be disrupted.

One member suggested BOJ should adjust level of interest rate at set pace, wide range of information will be available from now on including corporate first-half earnings, their outlook for full.

One member said waiting on rate hike could increase visibility on US economic outlook, but cost of doing so will gradually increase.

Few members weigh cost, benefit of waiting; BOJ needs to consider Japan's prolonged experience with deflation.

One member said it’s appropriate to maintain easy monetary conditions for as long as possible when anchoring of inflation expectations insufficient.

Some members noted exporters' profits have buffers against impact of US tariffs built up from past few years of weak yen.

One member said  US tariff impact smaller than expected, likely won't derail Japan's economy.

Market reaction to the BoJ Minutes 

At the time of writing, USD/JPY is down 0.43% on the day at 153.53.