Bank of Japan likely to keep stimulus measures unchanged in December

The Bank of Japan is set to meet this week for its monetary policy decision. According to a Scotiabank research report, the Japanese central bank is expected to mostly keep its stimulus measures unchanged. The policy rate is likely to remain at -0.1 percent, while the 10 year nominal bond yield target is expected to be kept on hold at 0 percent. Also the bond purchase program is expected to remain at JPY 80 trillion per year.

It is likely that the central bank extends a credit facility to motivate higher lending if not now, then before the existing programs expire in March, stated Scotiabank. Debates that are not expected to be discussed currently include a proposal by board member Goushi Kataoka and an academic critic to raise stimulus now in advance of the proposed sales tax rise in 2019.

The academic critic had pointed that increased stimulus might include a higher JPY 90 trillion per year bond purchase target and raising the inflation target by a point to 3 percent. Majority is against stimulus expansion, including Governor Kuroda and most of the board.

At 12:00 GMT the FxWirePro's Hourly Strength Index of Japanese Yen was highly bullish at 107.415, while the FxWirePro's Hourly Strength Index of US Dollar was slightly bearish at -59.8734. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex

FxWirePro launches Absolute Return Managed Program. For more details, visit http://www.fxwirepro.com/invest