There were no changes to the Yield Curve Control, and forward guidance remained unchanged. Inflation projections were revised lower from 2.8% to 2.4% for the fiscal year starting in April. The revision was mostly a consequence of declining oil prices, and the inflation path continues to show an overshoot of the target for some time.

Money markets currently price in a 10 bps rate hike in June. Extra help from a declining USD might push USD/JPY a bit lower (below 147.00) today, but we suspect that markets may favour defensive USD positions as the Fed meeting approaches.