The BoJ became the latest G8 central bank to ease policy this week. Governor Shirakawa and his policy makers announced a +Y10t increase in their asset-purchases and at the same time, formalized their inflation objective (an approach to fighting deflation). They intend to buy JGB’s with the new funds. The market risk is that the MoF follows this move with more aggressive intervention, normally this would be associated with the BOJ’s new policy stance. However, the MoF should be breathing a tad easier on the back of stronger US data which has the JPY under pressure outright, and on the crosses. Taking into account the ... (full story)