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Fundamental Forex Analysis

BOJ likely to cut economic projections due to coronavirus – Bloomberg survey

According to the latest Bloomberg survey, the Bank of Japan (BOJ) is seen trimming its economic projections again next month due to the massive economic fallout from the coronavirus pandemic.

Key findings

“The gloomier world view follows a lengthy state of emergency in Japan that BOJ board members will also need to factor into their quarterly forecasts when they meet on July 14-15.

A downgrade of BOJ forecasts by itself is unlikely to prompt further easing action by the bank, though economists say the calculus could change if markets also become more jittery and the yen suddenly strengthens.

Economists surveyed by Bloomberg predict a contraction of 5.3% for the same period.

Economists surveyed by Bloomberg expect the gross domestic product to shrink an annualized 22% this quarter, the most in more than six decades.”

Earlier today, the BOJ Governor Haruhiko Kuroda warned that Japan’s economy will likely see ‘considerable negative growth’ in Q2 2020.

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