RSS BOJ is expected to hold its policy rate at 0.25% in its December 18-19 meeting - preview

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 RSS BOJ is expected to hold its policy rate at 0.25% in its December 18-19 meeting - preview

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Bank of Japan (BOJ) December policy meeting concludes on Thursday.

As always, there is no firmly scheduled time for the Bank's Statement. Its reasonable to expect it sometime in the 0230 to 0330 GMT time window.

  • 2130 - 2230 US Eastern time

The BOJ is expected to hold its policy rate at 0.25% during its December 18 - 19 meeting, focusing on domestic wage and price trends amid uncertainty about U.S. economic policy. However, a rate hike cannot be ruled out if the yen weakens significantly, as the USD/JPY hovers just under 154.

The meeting will also unveil the results of a comprehensive review of the BOJ's past monetary policies, which are expected to acknowledge both the strengths and limitations of its ultra-loose stance. Additionally, the BOJ may outline plans to gradually reduce its ETF holdings, starting in 2026.

Labour market improvements, as highlighted in the December "Tankan" survey, support wage increases into 2025. If the wage-price cycle remains strong, a rate hike may occur in January 2025, with the possibility of rates reaching 1.0% by year-end 2025.

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Coming later on Thursday , due at 0630 GMT (0130 US Eastern time), traders should be wary of hawkish signals during Governor Kazuo Ueda’s press conference, as these could indicate potential policy shifts in the near future.

Earlier previews:

This article was written by Eamonn Sheridan at www.forexlive.com.
 
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