Alongside the mon pol meeting is the Bank of Japan policy review results.
The market chatter about the changes coming (I should say the speculation on the changes coming, we down;t know until the BOJ announces anything on Friday):
- widening the trading band for JGB yields
- abandoning the ETF buy tgarget
I (and other at FXL) have been posting on these.
The via Barclays (in brief):
- BOJ policy review will probably conclude without saying it'll widen the yield band - the BOJ will want to avoid any measure that may be interpreted as tightening
- given this, 10-20y JGBs should outperform
- there have been conflicting opinions from Governor Kuroda and Deputy Governor Amamiya, despite this the BOJ should increase flexibility around purchases (one way of doing so would be to end the current practice of publishing a monthly operation schedule of buying operations) without explicitly widening the trading band for 10-year bonds
Kuroda and Amamiya
