ANZ: Bank of Japan expected to stand pat this week, release hawkish signals

Golden Ten Data reported on March 17 that Brian Martin, Head of G3 Economics at ANZ Bank's Research Department, pointed out in a research report that, against the backdrop of rising energy costs and the recent weakness of the yen, the Bank of Japan is likely to keep interest rates unchanged at this week's meeting but release a hawkish signal. It is expected that the Bank of Japan will signal its readiness to adjust interest rates at an appropriate time and is closely monitoring exchange rate movements. Martin stated that he still expects the Bank of Japan to raise rates by 25 basis points at the April policy meeting, increasing the policy rate to 1.0%. The immediate challenge facing the Japanese economy is of a stagflationary nature—rising input costs are pushing up inflation while adversely affecting economic growth.