- BoJ to warn of uncertainty over the impact of US tariffs but may offer a less gloomy view.
- BoJ to keep interest rates unchanged at the July 30-31 meeting.
- BoJ likely to maintain view that inflation will durably hit its 2% target in the latter half of its three-year projection period.
- BoJ will consider revising up its inflation forecast for the current fiscal year.
This would mark a small step in the more hawkish camp. The BoJ has been placing a great deal on the US-Japan trade negotiations and that's likely what has been holding them back from delivering another rate hike.
The Japanese upper-house election this weekend could be the catalyst for some JPY appreciation in case the ruling bloc maintains majority. The market might look forward to a trade deal and eventually an earlier than expected rate hike given the high inflation and resilient economic data.
Bank of Japan
