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Bank of Japan decided on Friday that the probability of another rate hike is low
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Hello everyone, today XM Forex will bring you "[XM Forex Decision Analysis]: The Bank of Japan decided on Friday that the probability of hiking interest rates again is low." Hope it will be helpful to you! The original content is as follows:
XM xmspot.commentary: The Bank of Japan decided on Friday that the probability of hikes again is low
XM xmspot.commentary: During the Asian session this Friday, the Bank of Japan will announce the results of the interest rate resolution. The specific time is uncertain, and it is expected to be around 11:00 am Beijing time. Mainstream expectations believe that the Bank of Japan will continue to hold its feet on this resolution, and the probability of hikes is low. At 14:30 on the same day, Bank of Japan Governor Kazuo Ueda will hold a press conference on monetary policy to focus on his statements on Japan-US trade policies, interest rate trends and inflation data.
Most central banks in the world's mainstream developed economies are in a state of cutting interest rates or suspending interest rate cuts, and only the Bank of Japan has expectations of interest rate hikes. In the past two years, the Federal Reserve and the European Central Bank have cut interest rates three and eight times respectively, with the cumulative interest rate cuts of 100 basis points and 235 basis points respectively, and the trend of loose monetary policy is significant. The Bank of Japan did the opposite, not only did not follow the Federal Reserve's interest rate cut, but instead continued to raise the benchmark interest rate. In March, July, 2024 and January 2025, the Bank of Japan raised interest rates by 20 basis points, 15 basis points and 25 basis points respectively. Japan's monetary policy that deviates from the Federal Reserve has a significant promoting effect on the appreciation of the yen.
Japanese Prime Minister Shigeru Ishiba announced his resignation as prime minister, and the new prime minister is still in the xmspot.competition and there is no clear result yet. Shigeru Ishiba began to serve as Prime Minister of Japan in November last year and officially announced his resignation in September, with an 11-month term. During this period, the trade issues in the United States were mainly dealt with. Although the tariffs imposed by the United States on Japan were reduced to 15% from the previous 27.5%, it still caused dissatisfaction among the Japanese people and led to a significant decline in the Liberal Democratic Party's support rate. Before the new prime minister takes office, Japan's macroeconomic prospects are worrying, and it is expected thatThe Bank of Japan will not rashly announce a interest rate hike policy during this gap. According to economic data, Japan's GDP growth rate in the second quarter was 1.2%, and the quarterly rate was 0.5%, which performed well; in July, Japan's core CPI annual rate was 3.1%, lower than the previous value of 3.3%, but still higher than the 2% moderate inflation standard. Total exports in August were 8.425.1 billion yen, down from 9.539.1 billion yen last month and slightly lower than 8.432.5 billion yen a year ago. The decline in total exports is not unrelated to the United States' tariff policy towards Japan. Overall, Japan's macroeconomics remained weakly recovered. Without the suppression of the United States, the prospects would be more optimistic, but considering the tariff policy, the development prospects would be unclear.

▲XM chart
Technical analysis shows that at the daily level, USDJPY is a short trend in the medium and long term, but since April 22, it has entered the bottoming stage. In the figure, the black upward trend line is the support line for the bottoming structure. Once the support is effectively broken, a new round of downward trend will begin. Yesterday's K-line pattern was a hammer head, and the typical feature was that the lower shadow line was longer, which meant that the current buying power was stronger. And yesterday's lowest point coincided with the temporary low point on July 24, forming a standard double bottom structure. From a technical perspective, USDJPY will launch a rebound trend, with the upper limit of the rebound being between 0.382 and 0.618, corresponding to 147.94 and 149.06 points.
XM risk warning, disclaimer, special statement: The market is risky, and investment should be cautious. The above content only represents the analyst's personal views and does not constitute any operational suggestions. Please do not regard this report as the sole reference. At different times, analysts' views may change and updates will not be notified separately.
The above content is all about "[XM Forex Decision Analysis]: The Bank of Japan's decision on Friday, the probability of hiking interest rates again is low". It was carefully xmspot.compiled and edited by the editor of XM Forex. I hope it will be helpful to your trading! Thanks for the support!
Due to the author's limited ability and time constraints, some content in the article still needs to be discussed and studied in depth. Therefore, in the future, the author will conduct extended research and discussion on the following issues:
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