At the upcoming meeting, the Bank of Japan will revise up its inflation forecasts amid early signs of stronger wage pressures. While that could open the door for a further widening of the tolerance band, this would be a risky move when yields are already close to the current 0.5% ceiling. Indeed, we suspect that the Bank will keep policy settings unchanged for the foreseeable future.
Note: Join our Asia Drop-In on whether China is in a balance sheet recession, the July BOJ meeting and more at 09:00 BST/16:00 SGT on Thursday, 27th July. Register here.
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