BoJ seen forgoing July rate hike to ensure trouble-free start to QT
Key points
- We project BoJ will forgo rate hike when it releases “detailed plan” for reducing its bond purchases at July 30-31 Policy Board meeting
- We agree with market consensus that Bank will take monthly purchases down to JPY2-3 trillion over next two years
- BoJ may reaffirm April Outlook Report scenario, with Governor Ueda hinting at possible rate hike in near future
