JPMorgan and Moody's Analytics Anticipate Rate Hike from BOJ

Forex - JPMorgan (NYSE:JPM) and Moody's published investor notes this morning predicting that the Bank of Japan (BOJ) will implement a rate hike during its policy meeting this week.

JPMorgan's Japan Economic Research team stated that it is likely the BOJ will raise its policy rate by 25 basis points to 0.50% at its two-day meeting ending on Thursday. The team noted, "The BOJ's stance on additional rate hikes appears consistent, and the balance of recent data seems to meet these conditions."

Moody's Analytics also expressed in a note that it expects the BOJ to tighten monetary policy on Thursday. "We anticipate a 25 basis point increase to 0.5%. However, the likelihood of a hike in January versus December is approximately 60-40," Moody's Analytics stated, adding that the central bank is concerned that the weakness of the yen could increase inflation, harming real wages and consumer spending.

However, Moody's Analytics highlighted that financial markets have been tense over the past two weeks, and the yen has gained some value against the dollar.