BOJ Extra Easing Most Likely in April to June: Survey

Thirty-three percent of economists in a Bloomberg News survey expect the Bank of Japan to expand monetary stimulus in the April-June quarter. That compares with 37 percent in a survey conducted Dec. 10-12.

The BOJ is set to maintain its price outlook for FY2014 and FY2015 while slightly upgrading its FY2013 forecast to 0.8% at a meeting this week, according to the median estimate in the same survey.

Following are the results of the most recent survey, conducted Jan. 10-15.

1) When do you next expect the BOJ to expand monetary stimulus? 
===============================================================
Response Count:                       36  100%
---------------------------------------------------------------
A) Jan.-March 2014                     7   19%
B) April-June 2014                    12   33%
C) July-Sept. 2014                    10   28%
D) Oct-Dec 2014                        5   14%
===============================================================
Response Count:                       36  100%
---------------------------------------------------------------
E) After 2014                          2    6%
F) No further easing                   0    0%
===============================================================

2) How would the BOJ ease more next time? 
===================================================
Response Count:                       36  100%
---------------------------------------------------
a) Japanese government bonds          26   72%
b) Risk assets (ETFs, JREIT, etc)     30   83%
c) Cutting excessive reserve rates     2    6%
d) Extend current purchase program    21   58%
e) Others                              5   14%
===================================================

3) When will the BOJ start tapering?
===================================================
Response Count:                       36  100%
===================================================
Response Count:                       36  100%
---------------------------------------------------
A) 1H 2014                             0    0%
B) 2H 2014                             0    0%
C) 1H 2015                             0    0%
D) 2H 2015                             2    6%
E) 1H 2016                             4   11%
F) 2H 2016                             4   11%
G) 1H 2017                             2    6%
H) 2H 2017                             0    0%
I) After 2018                          9   25%
J) Unforeseeable                      15   42%
===================================================

4) BOJ says that the year-on-year rate of change in the core CPI (excluding
the direct effects of the consumption tax hikes) is likely to reach around
2 percent toward the latter half of the projection period through fiscal 2015. 
Do you think the BOJ’s projection will be realized?  
5) If no, do you think that the BOJ will abandon its target of securing
2 percent inflation within two years?
===================================================
2% Inflation                         Yes    No
---------------------------------------------------
Reach target                           2    33
 If not, abandon target               16    18
===================================================

6) The BOJ will have a midterm review of its GDP growth and price
forecasts at the January meeting. What do you expect the BOJ forecast
will be for core CPI (excluding the effect of the sales-tax increases)
for each of the three annual projection periods?
=======================================================
Core CPI YoY% change                FY13  FY14     FY15
-------------------------------------------------------
Median                              0.8%  1.3%     1.9%
Average                            0.76% 1.34%     1.9%
High                                0.9%  1.8%       2%
Low                                 0.7%  1.2%     1.7%
Mode (most frequent)                0.8%  1.3%     1.9%
-------------------------------------------------------

Individual Responses:             
===============================================================================
                                     Q.1   Q.2      Q.3   Q.4         Q.6
Economist and Firm                EasingEasing   Taper  Reach     CPI YoY%
                                  Timing  Type  Timing Target  FY13  FY14  FY15
-------------------------------------------------------------------------------
BofA Merrill Lynch: M. Kichikawa       A    BE  2H 2016   N/A  0.7%  1.3%  1.9%
Barclays Capital: K. Morita            B   ABD    2018~    No  0.8%  1.3%  1.9%
BNP Paribas: R. Kono                   E     A        *    No  0.7%  1.3%  1.9%
Capital Economics: M. Thieliant        D   ABD        *    No  0.7%  1.3%  1.9%
Citigroup: K. Murashima                B   ABD        *    No  0.7%  1.3%  1.9%
Credit Agricole: K. Ogata              B     A    2018~    No  0.8%  1.3%  1.9%
Credit Suisse: H. Shirakawa            A    AE        *    No  0.8%  1.2%  1.8%
Dai-ichi Life: H. Kumano               E     A        *    No  0.7%  1.3%  1.9%
Daiwa Research: M. Kumagai             B    AB        *    No  0.8%  1.3%  1.9%
Daiwa Securities: M. Noguchi           D     B        *    No  0.8%  1.3%  1.9%
Goldman Sachs: N. Baba                 B    BD        *    No  0.8%  1.3%  1.9%
HSBC Holdings: I. Devalier             C   ABD        *    No   N/A   N/A   N/A
Itochu Corp: Y. Maruyama               B    BD  2H 2016    No  0.8%  1.4%  1.9%
Japan Macro Adv: T. Okubo              A     D    2018~    No  0.8%  1.3%  1.9%
Japan Research: H. Matsumura           C     B  1H 2016    No  0.7%  1.3%  1.9%
===============================================================================
                                     Q.1   Q.2      Q.3   Q.4         Q.6
Economist and Firm                EasingEasing    Taper Reach     CPI YoY%
                                  Timing  Type   TimingTarget  FY13  FY14  FY15
-------------------------------------------------------------------------------
JPMorgan Chase: M. Kanno               B   ABD    2018~    No  0.8%  1.5%  1.9%
Meiji Yasuda: Y. Kodama                A    AB        *    No  0.8%  1.4%  1.9%
Mitsubishi UFJ Sec: N. Muguruma        A    BE        *    No  0.8%  1.3%  1.9%
Mitsubishi BCR: Y. Shimanaka           B   BDE  2H 2015   Yes  0.7%  1.8%    2%
MURC: S. Kobayashi                     B    AB    2018~    No  0.7%  1.3%  1.9%
Mizuho Research: H. Takata             A   ABD    2018~    No  0.9%  1.4%    2%
Mizuho Securities: Y. Ueno             C   ABD        *    No  0.7%  1.3%  1.9%
Monex Inc.: N. Murakami                C   ABE  1H 2016   Yes  0.8%  1.4%  1.9%
Morgan Stanley: T. Yamaguchi           C  ABDE  2H 2016    No  0.7%  1.3%  1.9%
NLI Research: Y. Yajima                B   ABD    2018~    No  0.8%  1.3%  1.9%
Nomura Sec: N. Matsuzawa               D   ABD  1H 2016    No  0.8%  1.3%  1.9%
Norinchukin Res: T. Minami             C  ABCD 1H 2017     No  0.7%  1.3%  1.9%
Okasan Securities: M. Suzuki           C   ABD  2H 2016    No  0.7%  1.3%  1.9%
RBS Securities: J. Nishioka            B    BD  2H 2015    No  0.8%  1.4%  1.9%
Shinshu Univ: A. Makabe                A  ABDE  1H 2016    No  0.8%  1.5%  1.7%
SMBC Friend: M. Iwashita               D     D        *    No  0.7%  1.3%  1.9%
===============================================================================
                                     Q.1   Q.2      Q.3   Q.4         Q.6
Economist and Firm                EasingEasing    Taper Reach     CPI YoY%
                                  Timing  Type   TimingTarget  FY13  FY14  FY15
-------------------------------------------------------------------------------
SMBC Nikko: C. Morita                  C   ABD    2018~    No  0.8%  1.3%  1.9%
Societe Generale: T. Aida              B   ABD 1H 2017     No  0.7%  1.3%  1.9%
Sumitomo Mitsui: H. Muto               C  ABCD    2018~    No  0.8%  1.3%  1.9%
Tokai Tokyo Sec: K. Sano               D    AB        *    No  0.8%  1.4%  1.9%
Totan Research: I. Kato                C   ABD        *    No  0.7%  1.3%  1.9%
===============================================================================

NOTE1: "*" = Unforeseeable NOTE2: For the individual responses, the number at the head of each column denotes the corresponding question.

Before it's here, it's on the Bloomberg Terminal.
LEARN MORE