BoJ will wait until June before tightening policy again

Bank of Japan Governor Ueda signaled this week that a rate hike at the Bank’s April meeting is off the table. While there’s a risk of prolonged inaction, a reopening of the Strait of Hormuz over the next few weeks would clear the path to further tightening at the Bank’s next meeting in June. Meanwhile, the recent tightening of skilled visa conditions risks causing a slowdown in immigration and a worsening of labour shortages.