BOJ dissenter Asada sets bar for supporting next rate hike, wants demand-driven inflation
USD/JPY — All Desk Targets
| Firm | Stance | YE 2026 |
|---|---|---|
UOB | Bearish | 163.00 |
Citi | Bearish | 163.00 |
MUFG | Bullish | 146.00 |
From the original
Asada's comments give the yen little fresh direction, since his message is essentially a conditional one, open to hikes but not committing to a timeline. The reference to a rapid pass-through of higher costs will draw attention from rate traders, as it suggests underlying price p
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4 itemsBOJ policymaker Masu warns that yen depreciation may raise inflation expectations
The desk views the recent commentary from BOJ policymaker Masu as a critical signal regarding the potential for yen depreciation to elevate inflation expectations in Japan. Per the full note [source], Masu highlighted the risks associated with rising inflation expectations that could stem from a weaker yen, emphasizing the need for the BOJ to maintain a vigilant policy stance. This aligns with our assessment that the BOJ may need to adjust its policy rate in response to evolving economic conditions, particularly as Japan grapples with inflationary pressures that have emerged more prominently than in previous decades. Current market sentiment reflects a cautious approach, with traders anticipating potential policy shifts in the near term.