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Will the BOJ really exit ultra-easing?

Will the BOJ really exit ultra-easing?

Yesterday, the Yen gained strength after reports in the press suggested that BOJ would be ending its ultra-easing policies. But, it’s not surprising that many traders were a bit skeptical. It’s not the first time that the media had reported plans to start tightening, only for the BOJ to insist it was keeping with easing. This time, will it be different?

The thing is, the press reports aren’t exactly pointing to anything new. They suggest that the BOJ will move to end ultra-easing in the first quarter of next year, assuming there isn’t a major change in the economy’s direction.

The Old News

But, that’s already been widely telegraphed. This study will be completed in March next year. There is a pretty broad consensus expecting that study to show that raising rates would be optimal, so it’s kind of a given that the BOJ would start hiking in, or soon after, the first quarter of 2024. We even discussed this in late September.

So, the timeline hasn’t changed. Transparency could be the more significant shift, especially since these rumors started circulating almost instantly after the BOJ…

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