VIEW: Barclays have revised their outlook for...>

BOJ: VIEW: Barclays have revised their outlook for BoJ monetary policy. They

retain their "forecast for the BoJ to dismantle its negative interest rate

policy (NIRP), where it has identified large negative side-effects, in July

2019, but we have dropped our projection for an increase in the flexibility of

yield curve controls (YCC) in April 2019. There are three main factors behind

this change: 1) our outlook for the Fed to hike rates at a slower pace than

previously expected; 2) tighter (less stable) financial conditions due to the

equity/FX market correction since end-2018; and 3) lower long-term yields (a

flatter yield curve) driven by risk-off flows. We believe the BoJ's window for

normalization has narrowed. However, we expect it to consider the trade-off of

extraordinary easing (balance between positive and negative effects) and take a

discretionary, pragmatic and opportunistic approach with a view to normalization

in the future."