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2025

2024

  • Euro wrap-up

    Euro wrap-up

    31 July 2024 676 KB PDF
    • BoJ opted to hike again at July MPM, in line with prior media reports; consistent with Outlook Report, reflects BoJ’s call that time was right to scale back easing; plans to cut JGB purchases to around Y3tn per month in Jan-Mar 2026 as expected
    • July Outlook Report forecasts sustained trend inflation of around 2%; BoJ to monitor service prices, consumer spending trends in gauging need for next rate hike; explanation of policy conduct, hawkish tone signal intent to continue normalizing
  • Iwashita's Economic & Market Watch

    Iwashita's Economic & Market Watch

    26 July 2024 364 KB PDF
    • BoJ to wait until last minute before making July rate hike decision
  • Daiwa's View - Consensus forming for BoJ’s QT; anticipate yield curve flattening pressure

    Daiwa's View - Consensus forming for BoJ’s QT; anticipate yield curve flattening pressure

    24 July 2024 452 KB PDF
    • “Bond Market Group” meeting minutes include opinion BoJ should lower its monthly JGB purchase amount to about ¥3.0tn 
    • In that case, BoJ’s holdings of JGBs would decline to ¥523tn (48% of all JGBs outstanding) in two years
    • Strong impact on medium- to long-term zone within JGB maturity structure; to act as yield curve flattening factor
  • Daiwa's View - Two consecutive days of currency intervention; what will BoJ do?

    Daiwa's View - Two consecutive days of currency intervention; what will BoJ do?

    17 July 2024 362 KB PDF
    • Changes in BoJ’s current account balances imply intervention on a scale of about Y2tn on 12 July, as well
    • Line of defense for USD/JPY rate is around Y159; EUR/JPY trends also warrant attention
    • Opinions regarding July rate hike by BoJ may be divided, but, in 2022, easing was modified after intervention
  • Daiwa's View - Intervention, rate check, then intervention again?

    Daiwa's View - Intervention, rate check, then intervention again?

    16 July 2024 399 KB PDF
    • It is highly likely that currency intervention was conducted on the 11th, but determining whether it occurred on the 12th is difficult
  • Daiwa's View - Implications from 20yr LCH-JSCC spread, more negative swap spreads

    Daiwa's View - Implications from 20yr LCH-JSCC spread, more negative swap spreads

    11 July 2024 701 KB PDF
    • 20yr swap spread deeply negative, 20yr LCH-JSCC spread below -2bp
    • Signals attractiveness of asset swaps, superlong JGB auctions’ potential reliance on arbitrageurs
    • May also indicate need to issue shorter maturity JGBs
  • Daiwa's View - BoJ holds “Bond Market Group” meeting

    Daiwa's View - BoJ holds “Bond Market Group” meeting

    10 July 2024 354 KB PDF
    • BOJ released “Responses to Opinion Inquiries” and “Examples of Specific Opinions” to share opinions received at meeting
    • Left impression that many opinions were covered in published materials; no particular consensus was formed
    • BOJ officials expected to make final decision on proposed JGB purchasing reductions, focusing on these proposals, while monitoring balance between predictability and flexibility
  • Daiwa's View - Revising forex outlook to reflect pickup in carry trades