Former executive director in charge of monetary policy during the pandemic (and also once head economist at the Bank of Japan) Eiji Maeda. Maeda spoke with Reuters in an interview on Wednesday.
- says the BOJ may end its negative interest rate policy in January
- may then raise short-term rates in stages, if the economy can weather risks from overseas uncertainties
More:
- says the “surprisingly big” upgrade in inflation projections at the October meeting means
inflation is already on course to sustainably hit the BOJ’s 2%
target - BOJ could revise up its price forecasts again
in January - Such a revision would would allow the Bank to end negative short-term rates
- “There’s a chance the BOJ could end negative rates as early
as January next year, if it judges that inflationary pressure is
heightening,” - “The BOJ could also end yield curve control. In doing so, it
may put in place a guidance pledging to buy government bonds
nimbly to counter any spike in long-term rates,” - “After pushing short-term rates to zero from negative
territory, the BOJ could raise interest rates gradually in a
pace of once every few months with a close eye on economic and
price developments,”
USD/JPY is barely moving in response.
This article was written by Eamonn Sheridan at www.forexlive.com. Source