Financial institution of America World Analysis discusses its expectations for this week’s BoJ coverage assembly.
“We count on the Financial institution of Japan (BoJ) to maintain all key targets,
in addition to its ahead steering, unchanged at its upcoming coverage board
assembly on Friday, 28 October. The board can be more likely to
go away, intact, the +25bp ceiling for the 10-year yield below yield curve
management (YCC) and reiterate its pledge to conduct limitless, each day,
fixed-rate bond-buying operations in its protection,” BofA notes.
“Within the FX house, USD/JPY is more likely to retest 150 by the year-end and probably rise to 155, with 160 in sight. The MoF would seemingly intervene as USD/JPY makes an attempt new highs. Nonetheless, contemplating it will want to keep up a sure degree of liquid, international reserve balances at a sure degree, markets are more likely to see the MoF’s firepower as restricted and FX intervention is unlikely to be enough to cease the upward strain on USD/JPY.
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