The Bank of Japan meet this week on Thursday and Friday (28th and 29th), here is a preview via Barclays:
- We expect the BoJ to keep its policy settings unchanged
- BoJ will wait until April to evaluate its current monetary policy stance, when updated inflation forecasts and more clarity about the evolution of wages will be at hand
But, says Barclays, the markets will be looking for a more dovish forward bias, because:
- Renewed decline in oil prices lowers inflation expectations globally & fuels downside risks to wage increases in the coming shunto negotiation
On the yen:
- Could weaken coming into the meeting
- Especially if global risk sentiment remains supported after ECB's signal of additional easing
(Boldings above are mine)
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ps. Shunto is a Japanese term referring to the upcoming Springtime wage negotiations
