The Bank of Japan’s upcoming meeting (Jan 22 – 23) will not see an end to negative rates

The Bank of Japan is next meeting on January 22 and 23.

The deadly New Year earthquake has finally extinguished hope (there’s that four-letter word again) for an end to BOJ negative rates at this meeting. I find it difficult to believe that anyone even remotely in touch with relevant BOJ/yen news ever entertained thoughts of such a move in January, but I do welcome ill-informed speculation in markets. I love it when the competition is clueless.


Mizuho Bank:

  • “Although there must be quite a few foreign investors who have been anticipating the end of negative rates in January, under these circumstances, the BOJ will almost certainly not move this month,”

Daiwa Securities:

  • “negative rates … January move seems even more impossible”

The ending of the prospect of a January move away from negative rates from the BOJ has been cited as a reason for the yen fall, with USD/JPY back towards 144.50. Don’t forget to add in the equally insane thoughts of a January rate cut from the Federal Open Market Committee (FOMC). The prospect of that has dropped to zero too, thankfully.

The USD/JPY carry is still circa 5.5% and will be for a few months to come.

USD/JPY update.

This article was written by Eamonn Sheridan at Source