Bank of Japan Policy Meeting Preview - Don't Hold Your Breath for a Hike
A brief summary of a long piece from Reuters on what to expect from the BoJ this week. BOJ meeting concludes Thursday; rates expected to stay unchanged at 0.25%Weekend election loss complicates BOJ's normalization pathUSD/JPY hit 3-month highs near 153.50 as markets bet on delayed hikesMore:BOJ's in no rush with inflation stable around 2%Quarterly outlook report unlikely to show major forecast changesPolitical uncertainty after ruling coalition's defeat adds new wrinkleMost economists now see no hike until 2025 Q1The wild card? Ueda's tone at the press conference (3:30pm Tokyo/0630 GMT Thursday). Watch for:Any shift from September's dovish "we can afford to wait" stanceFresh warnings about yen weakness (dollar/yen's been on a tear)Hints about wage growth expectations for 2025Bottom line: The path to BOJ's "neutral" 1% rate target looks bumpier after the election. Ishiba's weakened position means he'll need support from parties favoring ultra-loose policy. That's not great news for yen bulls.Next BOJ meetings: Dec 18-19 and Jan 23-24, but March 2025 looking more likely for the next move.***USD/JPY update: This article was written by Eamonn Sheridan at www.forexlive.com.
A brief summary of a long piece from Reuters on what to expect from the BoJ this week.
- BOJ meeting concludes Thursday; rates expected to stay unchanged at 0.25%
- Weekend election loss complicates BOJ's normalization path
- USD/JPY hit 3-month highs near 153.50 as markets bet on delayed hikes
More:
- BOJ's in no rush with inflation stable around 2%
- Quarterly outlook report unlikely to show major forecast changes
- Political uncertainty after ruling coalition's defeat adds new wrinkle
- Most economists now see no hike until 2025 Q1
The wild card? Ueda's tone at the press conference (3:30pm Tokyo/0630 GMT Thursday). Watch for:
- Any shift from September's dovish "we can afford to wait" stance
- Fresh warnings about yen weakness (dollar/yen's been on a tear)
- Hints about wage growth expectations for 2025
Bottom line:
- The path to BOJ's "neutral" 1% rate target looks bumpier after the election. Ishiba's weakened position means he'll need support from parties favoring ultra-loose policy. That's not great news for yen bulls.
Next BOJ meetings:
- Dec 18-19 and Jan 23-24, but March 2025 looking more likely for the next move.
***
USD/JPY update: This article was written by Eamonn Sheridan at www.forexlive.com.
