BoJ Rate Guidance May Strengthen Yen Against Dollar, Says Commerzbank

Commerzbank analyst Volkmar Baur expects the Bank of Japan to keep its overnight call rate unchanged at the upcoming meeting, a move fully priced in by markets. The focus instead shifts to the central bank’s policy guidance.

With inflation hovering around 2% and leading indicators pointing upward, the BoJ may adjust its communication in a less accommodative direction. Such a shift could provide support for the Japanese yen, pushing USDJPY lower.