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JiJI Sources Point To New Policy Framework

BOJ

JPY rallies and JGB futures soften as RTRS cover a JijI sources pieces which suggests that “the BoJ is considering a new quantitative monetary policy framework that will show the outlook for upcoming government bond buying amounts.”

  • A second round of headlines covering the story suggest that the “BoJ will review YCC as it considers the new quantitative policy framework.”
  • While the RTRS coverage is light on details markets look at this as forming part of the normalisation of BoJ policy via reduced JGB purchases/looser YCC.
  • This week’s BoJ source pieces, wage data and initial Rengo wage demands had already deepened pricing re: a potential March BoJ rate hike (~70% priced into BoJ-dated OIS at present).
  • An exit from BoJ NIRP is fully priced come the end of its June meeting.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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