July Most Likely Month for Extra BOJ Easing: Survey

Forty-three percent of economists in a Bloomberg News survey forecast the Bank of Japan will expand monetary stimulus in July, down from 44 percent in a survey earlier this month.

Following are the results of the most recent survey, conducted April 16 to 21.

1) When do you next expect the BOJ to expand monetary stimulus? 
===============================================================
Response Count:                  35    100%
---------------------------------------------------------------
A. This meeting                   1      3%
B. May                            1      3%
C. June                           4     11%
D. July                          15     43%
E. August                         1      3%
F. September                      0       -
G. October 7                      1      3%
H. October 31                     4     11%
I. November                       0       -
J. December                       0       -
K. January 2015                   2      6%
L. February 2015                  0       -
M. March 2015                     0       -
N. April 2015 or later            0       -
O. No additional stimulus         6     17%
===============================================================

2) How would the BOJ ease more next time? 
===============================================================
Response Count:           
---------------------------------------------------------------
A. Expand monetary base          21
B. Expand JGBs                   22
C. Expand ETFs                   27
D. Expand J-REITs                15
E. Cut excess reserve rate        1
F. Others                         7
===============================================================

3) When will the BOJ start tapering?
===============================================================
Response Count:                  35
---------------------------------------------------------------
A. 1H 2014                        0
B. 2H 2014                        0
C. 1H 2015                        0
D. 2H 2015                        0
E. 1H 2016                        6
F. 2H 2016                        3
G. 1H 2017                        3
H. 2H 2017                        1
I. After 2018                     8
J. Unforeseeable                 14
===============================================================

4) The Bank of Japan has said that Core CPI (inflation excluding
fresh food, and also excluding the effects of the sales tax
rises) is likely to reach around 2% y/y -- the price stability
target --  toward the latter half of the projection period
through fiscal 2015. Do you think this forecast is achievable? 
===============================================================
2% Inflation                    Yes      No
---------------------------------------------------------------
Reach target                      2      33
===============================================================

5) If no, please state if you think the BOJ will have to alter
the 2% price stability target with a time-frame of 2 years.
===============================================================
BOJ will alter:           Response count:
---------------------------------------------------------------
A. 2 years                       23
B. 2%                             -
C. both 2 years and 2%            3
D. neither 2 years nor 2%         6
===============================================================

6) If core CPI reaches the 2% price target in the period "from
the end of FY2014 through FY2015" as the BOJ is projecting,
what will be the yield on new 10 year government revenue
bonds at the end of FY2014 and the end of FY2015?
===============================================================
New 10-year bond yield       FY2014          FY2015
---------------------------------------------------------------
Median                    1.0%-1.2%        1.4%-1.6%
High Forecast             2.0%-2.2%        2.4%-2.6%
Low Forecast              0.6%-0.8%        0.8%-1.0%
===============================================================

7) What will the BOJ’s GDP, Core CPI forecasts be in the Outlook
Report?                   
================================================================
Median Forecast           FY13     FY14    FY15    FY16   
----------------------------------------------------------------
Real GDP growth rate      2.2      0.8     1.4     1      
Core CPI (minus sales tax)0.8      1.1     1.2     1.3    
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