Nomura Japan Chief Economist Predicts Bank of Japan to Raise Interest Rates Again in 2024
Recently, Nomura Japan Chief Economist Dr. Kyohei Morita shared his latest research views on Japan’s comprehensive adjustment of monetary policy. The Bank of Japan made significant changes to its monetary policy at a meeting on March 19, including ending the yield curve control policy, adjusting the hierarchical system, canceling the purchase of ETFs and J-REITs, and more.
The decision by the Bank of Japan is being seen as in line with market expectations. The adjustments signify a move towards normalizing monetary policy and moving away from ultra-loose monetary measures. Some of the key changes include shifting the short-term policy rate, adjusting the deposit tier system, cancelling ETF and J-REIT purchases, and eliminating forward guidance on easing policy.
Nomura Securities expects the Bank of Japan to raise interest rates again in October 2024, with the target set at 0.25%. This prediction is based on the positive results of the first round of spring salary negotiations, indicating a significant wage increase that could impact inflation rates. Overall, the Bank of Japan’s decision and Nomura’s forecast indicate a future trajectory towards a more stable and normalized monetary policy in Japan.
(Source: Nomura Securities)