Bank of Japan; will they, won't they?


The Forex markets remain subdued in morning trading, very much in the wait-and -see mode before economic data releases and Central Bank announcements. Latest Japanese economic data releases pushed the possibility of the Bank of Japan stepping back from their policy of ultra easing. The current conditions Economic Watchers Survey remained steady at 53.5 from last months 52.1, while the outlook component remained a steady lthy 56.6 from the previous 56.4. The data indicated that the most economically sensitive workers, such as taxi drivers, restaurant owners, and retail sales staff, continued to be optimistic. The Leading Economic Index rose to 85.0 pct, its first consecutive gain in seven months. The report is the widest measure of future economic activity in the country encompassing such indicators as consumer confidence and labour productivity. The coincident index, a synopsis of the current state of the economy, remained at 100%. While some fx traders saw this data as nudging the Bank of Japan ( BOJ ) towards some tightening measures, this scribe still takes the view, along with many currency market traders, that following recent comments by the politicians the Bank of Japan will defer any action until the new fiscal year.