BoJ keen to hike but risks tilted towards further delay

We are sending this publication one day earlier than usual because our Singapore office is closed due to a public holiday on 1st May.

The Bank of Japan is clearly worried about the inflationary consequences of the Iran War. But a  prolonged closure of the Strait of Hormuz also adds to the downside risks to economic activity. Accordingly, risks are tilted towards the Bank hiking rates later than our current forecast of June.