Trade Deficit
In Japan, imports exceeded exports by 932.1 billion yen ($9.5 billion) in September, the finance ministry said in Tokyo today. That was more than the 918.6 billion trade gap expected by economists in a Bloomberg News survey and compared with a revised 962.8 billion deficit in August.
The BOJ will continue easing until its 2 percent inflation target is stable, Kuroda said today at a central bank branch managers’ meeting in Tokyo.
Japan’s Prime Minister Shinzo Abe is seeking to maintain momentum in a recovery spurred by fiscal and monetary stimulus by implementing growth measures that are the focus of an extraordinary session of parliament that began last week.
Fed Bets
The Fed buys $85 billion of bonds a month to put pressure on long-term borrowing rates and spur growth. Policy makers unexpectedly refrained from reducing purchases last month, saying they wanted more evidence of an economic recovery.
The central bank will delay the first cut to its buying until March, according to the median estimate of 40 economists in a Bloomberg survey conducted Oct. 17-18. A poll last month forecast the first reduction would be in December.
Fed policy makers had pledged since December they won’t consider raising the interest rate as long as the unemployment rate exceeds 6.5 percent. The jobless rate held at 7.3 percent last month, economists in a Bloomberg poll projected before the Labor Department data on Oct. 22. The release was postponed from Oct. 4 because of the partial government shutdown.
Economists in a separate Bloomberg survey estimate nonfarm payrolls increased by 180,000 workers last month.
“It’s hard to construct a bullish U.S. dollar scenario,” said Sean Callow, a senior currency strategist at Westpac Banking Corp. (WBC) in Sydney. “The outlook is certainly for the Fed to be very generous in its monetary settings for probably longer than the market is thinking.”
Worst Performer
The dollar has fallen 3.5 percent in the past three months, the worst performer among 10 developed-nation currencies tracked by Bloomberg Correlation-Weighted Indexes. The euro has risen 0.9 percent in the same period while the yen lost 0.5 percent.
“The yen is being sold in risk-on trade as stocks rise,” said Junichi Ishikawa, an analyst at IG Markets Securities Ltd. in Tokyo. “Given that the bets for December tapering have been pared back, there is optimism that the Fed’s easy money will continue to support stock markets.”
