The Bank of Japan did not pull the trigger on more monetary stimulus. They will leave the current rate of purchases at 80 trillion yen per year. These will continue to include various ETFs.
They did lower their forecasts though. USD/JPY is around 121 after wild swings to both sides.
The BOJ sees Core CPI at 0.1% in the fiscal year of 2015, rising to 1.4% in 2016 and 1.8% in 2017. These are lower forecasts. And regarding CPI, this depends on oil prices. When will the BOJ reach its target? Only the second half of FY2016.
They also lowered growth forecasts but still see growth coming despite the slowdown in emerging markets.
Risks come from the the next hike in the sales tax in 2017, but CPI should rise with wage growth.
In the press conference, BOJ Governor Kuroda still sees a virtuous cycle.
Despite this cycle of success, there is a fresh report saying that the Japanese government will add a supplementary budget of 3 trillion yen.
Last year we had the BOJ and the government announcing stimulus at the same time, and this knocked down the yen.
USD/JPY chart. Note that the pair went all the way to 121.50 before sliding. This is a double top now.During the hours of waiting, the pair dropped all the way to 120.30.