RBA and BoJ minutes published today - BBH

Research Team at BBH, notes that both the Reserve Bank of Australia and the Bank of Japan published minutes from their recent meetings. 

Key Quotes

“The minutes tended to strengthen already existing views.  The RBA has adopted a neutral stance.  It is more upbeat on the economy than previously.  It would take a drop in inflation to bring a rate cut back on the table.  Note that Australia is holding national elections in early July, and in economic terms, the campaign is being fought over increased public investment or corporate tax cuts. 

The take away from the BOJ minutes is that although most members agreed that QQE was having a clear impact, officials were still concerned about the downside risks to both economic activity and prices. There is a risk that the BOJ takes new action at next month's meeting when it reviews it growth and inflation projections.  It would be six months since the BOJ's late-January surprise adoption of a negative deposit rate.  It is arguably in a position to evaluate it impact, and moreover, to address the tightening of financial conditions represented by the stronger yen and the decline in equities.”