Peking Finance APP learned that the Governor of the Bank of Japan, Haruhiko Kuroda, will deliver a speech and hold a press conference next Monday in Nagoya, a central city in Japan. The market is eager and hopes to gain clues from the Bank of Japan on when they may raise interest rates again. The Bank of Japan has announced that Haruhiko Kuroda will deliver a speech in Nagoya from 09:00 to 10:30 Beijing time, and will hold a press conference from 12:45 to 13:15. Since Trump's victory in the US presidential election, this is the first opportunity for Haruhiko Kuroda to directly discuss monetary policy. Previously, Japan's GDP data for the third quarter showed surprising elasticity in consumption, but the market is divided on whether the Bank of Japan will raise interest rates in December or January of next year.

Some analysts believe that after unexpectedly raising interest rates in July, Haruhiko Kuroda was criticized. Therefore, if the Bank of Japan wishes to prepare for a rate hike for the December meeting, Haruhiko Kuroda may hint at a tough stance. At the same time, the decline in the yen against the dollar has increased the pressure on the Bank of Japan to raise interest rates as soon as possible, as a weaker yen would push up inflation and damage household spending.

In addition, the decline in the yen against the dollar has also increased the pressure on the Bank of Japan to raise interest rates soon. Since a weaker yen would push up inflation and damage household spending by increasing import costs, some analysts believe that the Bank of Japan may take action as soon as possible.

Previously, after briefly rebounding to around 141 in September, the yen against the dollar fell back to the level before the Bank of Japan's July interest rate hike. Currently, the yen against the dollar is hovering around 156, close to 160, a level that policymakers are concerned about.

Naomi Muguruma, Chief Bond Strategist at Mitsubishi UFJ Morgan Stanley Securities, stated that as long as wages and service prices continue to rise at the current pace, the Bank of Japan may adjust the degree of monetary support. Meanwhile, a weaker yen also brings new inflation risks, further increasing the likelihood of a rate hike in December.

It is worth noting that according to data released on Wednesday, the wholesale inflation in October climbed at the fastest pace in over a year due to the depreciation of the yen leading to higher import costs for some commodities, further increasing the possibility of a rate hike.

To counteract the inflation pressure and the impact of the yen depreciation, the Bank of Japan ended its negative interest rate policy in March and raised the short-term policy rate to 0.25% in July. However, despite these measures, there is still uncertainty in the market about whether the Bank of Japan will raise interest rates again.

A Reuters survey conducted from October 3 to 11 showed that the vast majority of economists predict that the Bank of Japan will not raise interest rates again this year, although nearly 90% of economists expect the Bank of Japan to raise interest rates by the end of March next year.

Editor/ping