BOJ to raise interest rates to 1% in June meeting - poll

BOJ reportedly set to raise short-term policy rate to 1% next week

BOJ reportedly expected to raise interest rates later this month - report

BOJ March minutes says rates will be raised in line with improvements in economy, priced

The desk interprets the Bank of Japan's March minutes as indicative of a growing internal debate regarding the urgency of rate hikes, particularly in light of rising inflation risks tied to geopolitical tensions. The BOJ's 8-1 vote to maintain rates at 0.75% reflects a cautious approach, but the minutes reveal a significant concern about falling behind the curve on inflation, especially with the Iran conflict driving up oil prices. Per the full note [source], the board's discussions suggest that further rate increases are likely if economic conditions and inflation expectations evolve as anticipated. This aligns with our view that the BOJ may need to act sooner than previously expected to maintain price stability.

Japan currency intervention not likely to sustainably curb yen weakness - poll

The desk believes that Japan's currency intervention efforts are unlikely to yield sustainable results in curbing yen weakness, particularly as the USD/JPY approaches 158.50, the highest level in two weeks. Per the full note [source], a recent Reuters poll indicates that 74% of economists view currency intervention as ineffective, while 65% expect the Bank of Japan (BOJ) to raise rates to 1.00% by June. This sentiment is compounded by the ongoing geopolitical tensions in the Middle East, which may further complicate Japan's economic outlook.