BoJ Governor Haruhiko Kuroda said in a speech that Japan’s situation “differs” from both the US and the Eurozone. The country is still “on its way to recovery”. Output gap has “remained in negative territory”, but projected to “turn positive” as some point in H2 of this fiscal year. Inflation rate “has not risen from the demand side”. Current rise in inflation was “led by rise in import prices”, and the rate is projected to decline back to below 2% from fiscal 2023.
He reiterated that BoJ “deems that it should continue with monetary easing and thereby firmly support economic activity”. By doing so, “it aims to provide a favorable environment for firms to raise wages and to achieve the price stability target in a sustainable and stable manner, accompanied by wage increases.”
Regarding exchange rates, Kuroda said the “abnormally one-sided, sharp yen weakening appears to have paused, thanks partly to government’s FX intervention.” He emphasized it is “important for forex rates to move stably reflecting economic fundamentals”.
UK confirmed arranging Brexit parliament vote on Jan 15, subject to approval
UK Prime Minister Theresa May’s spokesman James Slack confirmed today that a vote is scheduled in the parliament on Tuesday, January 15 on the Brexit agreement. He told reporter that “Subject to parliament approving a business motion, the debate will be opened tomorrow … The prime minister said that she would close the debate next Tuesday, which is January 15, when the vote will take place,”
Also he added that May is not trying to delay Brexit by extending Article 50 withdrawal notice. And, the idea may have been discussed by EU officials but not by British officials.