Saturday, 9 August 2014

BoJ keeps policy unchanged as Japan's current account falls into deficit

The Bank of Japan left monetary policy unchanged at its meeting on Friday.

The BoJ refrained from injecting new monetary stimulus despite weak economic data on Friday.

Japan's current account balance fell back into deficit in June, the first in five months.

The economy watchers survey showed that the current conditions index rose to 51.3 in July from 47.7 in June but the future conditions index fell to 51.5 from 53.3, the second consecutive decline.

Meanwhile, though, China's trade surplus rose in July as exports increased 14.5 percent from the previous year, well up from the 7.2 percent increase in June. Imports fell 1.6 percent after increasing 5.5 percent in June.

Germany saw both exports and imports rise in June by 0.9 percent and 4.5 percent respectively. Nevertheless, weak industrial data earlier in the week suggest that "German GDP is likely to have contracted slightly in the second quarter", according to Christian Schulz, senior economist at Berenberg Bank.

Elsewhere in Europe, a 0.4 billion pound fall in exports pushed the UK trade deficit up in June but construction output rose 1.2 percent.

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