Global macro overview for 07/10/2015:
It has been almost a year since the BoJ last stimulus had shocked the markets. Since then, the Prime Minister Shinzo Abe's brave goal of 2% inflation target remains elusive. In today's monetary policy statement, the BoJ has stated that it will conduct money market operations so that the monetary base will increase at an annual pace of about 80 trillion yen. Moreover, the BoJ will purchase Japanese government Bonds (JGBs), exchange-traded funds (ETFs) and Japan real estate investment trusts (J-REITs). Further in the statement, the BoJ said Japan's economy is expected to continue recovering moderately mainly due to a slowdown in emerging markets growth. The Bank of Japan will continue with qualitative monetary easing (QQE), aiming to achieve the price stability target of 2% ,as long as it is necessary for maintaining that target in a stable manner.
The daily technical outlook for USD/JPY hasn't changed much. After the initial decline on last Friday, the market rallied back to the range and is currently trading in the middle of the range. The most important support is seen at the level of 118.60 and resistance at the level of 121.23.