Institution: Low Likelihood of BOJ Governor Issuing Excessively Hawkish Signals

Odaily Planet Daily reports that Morgan Stanley MUFG Securities believes there is a low probability that Bank of Japan Governor Kazuo Ueda will issue excessively hawkish signals (i.e., beyond what the market has already priced in) at next week's press conference.

In a report, four economists and strategists from the institution noted that the overnight index swap market has largely priced in expectations of a BOJ rate hike to 1.25% by the end of the year. Additionally, uncertainty surrounding the situation in the Middle East has increased recently, and there have been some signs of instability in the stock market. The report also forecasts that the BOJ may raise the policy rate by 25 basis points to 1.00% at its June meeting. (Jin Shi)