BOJ preview: Daiwa sees hold, but 2% inflation call could open door to December hike
USD/JPY — All Desk Targets
| Firm | Stance | YE 2026 |
|---|---|---|
Rabobank | Bullish | 145.00 |
ING | Bullish | 152.00 |
MUFG | Bullish | 152.00 |
From the original
A hold is largely the base case, so the yen and JGB yields are likely to take their cue from the language rather than the decision. A formal declaration that underlying inflation has reached 2%, a Takata dissent and any shift by Ueda toward “next meeting” phrasing would together
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4 itemsBOJ to hold at 1.25%, but Ueda signals further hikes toward neutral
BoJ preview: hold at 1.25% expected, with 2% inflation call and dissent risk in focus
BoJ preview: MUFG sees hold but a 2% inflation call, with two dissenters the key yen risk
The desk expects the Bank of Japan (BoJ) to maintain its current interest rate at 1.25% during the upcoming meeting, citing a shift in rhetoric towards a declared effective 2% inflation target as a potential precursor to future rate hikes. This perspective aligns with insights from MUFG, which suggests that a firm communication from BoJ Governor Ueda may enhance support for the yen and accelerate expectations for rate increases in December [source]. Current positioning may be sensitive to dissent from two board members traditionally opposed to rate hikes, who could pose a risk to yen stability if they advocate for a cut instead. Should the BoJ maintain a cautious stance while inflation remains a concern due to external pressures such as rising oil prices, it could lead to upward pressure on short-end JGB yields and support the yen in the near term.
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