Bank of Japan Watch

Bank of Japan Watch

Bank to look through weaker yen and supply shortages

Sitting comfortably with continuity candidate PM Kishida in charge, the Bank of Japan won’t alter its major policy settings at its October meeting. And we doubt the Bank will respond with policy tweaks to the recent weakening in the yen, nor to continued supply chain disruptions.

21 October 2021

Bank of Japan Watch

PM frontrunner Kono may favour sharper taper

Dug in for an extended hold, the Bank of Japan won’t alter its major policy settings at its September meeting. Further ahead though, PM Suga’s successor – to be elected in two weeks’ time – may look towards prodding the Bank into shrinking its balance sheet.

16 September 2021

Bank of Japan Watch

New climate change facility not a game changer

At its July meeting we expect the Bank of Japan to outline that it will offer interest-free loans to banks under its new fund-provisioning measures aimed at addressing climate change. Beyond that though, the Bank won’t alter its major policy settings.

9 July 2021
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Bank of Japan Watch

Asset purchases to remain low but rates on hold

At its June meeting we think the Bank of Japan may extend the deadline on its emergency lending facility from September to December. Beyond that point, it should further taper its purchases of short-dated debt as it digs in for a prolonged hold.

Bank of Japan Watch

Bank preparing for prolonged hold

After tweaking a range of policy measures in March, the Bank of Japan will keep policy settings unchanged in April. By addressing the side effects of ultra-loose policy, the Bank has set the stage for a prolonged period of inaction.

20 April 2021

Bank of Japan Watch

Bank likely to defer widening of tolerance band

The pendulum seems to have swung back against the Bank of Japan making any changes to its yield target next week or indeed any major changes at all. That is most likely because the Bank doesn’t want to risk triggering an adverse market reaction when the economic recovery from the pandemic is still ongoing. The idea is likely to return when the economy looks more secure.

11 March 2021

Bank of Japan Watch

Bank unlikely to ease more in response to virus wave

The Bank of Japan is unlikely to respond to the worsening virus outbreak with additional stimulus. However, policymakers may provide some hints at the upcoming meeting about what to expect from the policy review due in March.

Bank of Japan Watch

Bank to extend lending programmes

With the ongoing wave of infections in Japan the most severe yet, the Bank of Japan will probably extend its lending facilities beyond March 2021 at the upcoming meeting. But we don’t expect it to change interest rates for the foreseeable future.

10 December 2020
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