www.reuters.com Open in urlscan Pro
2600:9000:235a:7c00:15:5a3e:9d40:93a1  Public Scan

Form analysis
0 forms found in the DOM

Text Content

Skip to main content

Exclusive news, data and analytics for financial market professionalsLearn more
aboutRefinitiv

Reuters home
 * WorldChevron
   Browse World
    * Africa
    * Americas
    * Asia Pacific
    * China
    * Europe
    * India
    * Israel and Hamas at War
    * Japan
   
    * Middle East
    * Ukraine and Russia at War
    * United Kingdom
    * UK Election
    * United States
    * US Election
    * Reuters Next
   
   Latest in World
    * Trump survives assassination attempt at campaign rally after major
      security lapse
      7 min ago
      article with video
    * Reactions to shooting at Trump rally in Pennsylvania
      7 min ago
      article with video
    * Here's what we know about Thomas Matthew Crooks, the suspected Trump rally
      shooter
      13 min ago
      article with video
    * LIVE
      Trump Shooting Live: FBI names suspect in assassination bid
      25 min ago
      

 * BusinessChevron
   Browse Business
    * Aerospace & Defense
    * Autos & Transportation
    * Davos
    * Energy
    * Environment
    * Finance
    * Healthcare & Pharmaceuticals
   
    * Media & Telecom
    * Retail & Consumer
    * Future of Health
    * Future of Money
    * Take Five
    * World at Work
   
   Latest in Business
    * Trump-victory trades to swell after shooting, investors say
      9:40 AM GMT+2
      
    * Investors react to shooting at Trump election rally
      9:20 AM GMT+2
      
    * Elon Musk endorses Trump in presidential race, calls him "tough"
      4:10 AM GMT+2
      
    * OpenAI whistleblowers ask SEC to investigate alleged restrictive
      non-disclosure agreements
      July 13, 2024
      

 * MarketsChevron
   Browse Markets
    * Asian Markets
    * Carbon Markets
    * Commodities
    * Currencies
    * Deals
    * Emerging Markets
    * ETFs
    * European Markets
   
    * Funds
    * Global Market Data
    * Rates & Bonds
    * Stocks
    * U.S. Markets
    * Wealth
    * Macro Matters
   
   Latest in Markets
    * Take Five: Cancel Summer?
      July 13, 2024
      article with video
    * TSX hits record high, Aritzia top performer after strong results
      July 12, 2024
      
    * Dollar falls vs. yen, global stock index up, with focus on rate cuts
      July 12, 2024
      
    * IMF says emerging market capital inflows recover to 2018 levels
      July 12, 2024
      

 * SustainabilityChevron
   Browse Sustainability
    * Boards, Policy & Regulation
    * Climate & Energy
    * Land Use & Biodiversity
    * Society & Equity
    * Sustainable Finance & Reporting
    * The Switch
    * Reuters Impact
   
   Latest in Sustainability
    * Thai regulator accuses Energy Absolute CEO and deputy of fraud
      July 13, 2024
      
    * Institutions snapping up Chinese treasury bonds are shorting the economy,
      state media says
      July 13, 2024
      
    * As Argentine inflation cools to single digits, residents are still
      skeptical
      July 13, 2024
      
    * US FTC issues warning to franchisors over unfair business practices
      July 13, 2024
      

 * LegalChevron
   Browse Legal
    * Government
    * Legal Industry
    * Litigation
    * Transactional
    * US Supreme Court
   
   Latest in Legal
    * Alec Baldwin "Rust" shooting case dismissed over withheld evidence
      July 13, 2024
      article with video
    * Court upholds Tennessee ban on changing sex in birth certificates
      July 13, 2024
      
    * Alec Baldwin: Timeline of events leading to ‘Rust’ trial
      July 13, 2024
      article with gallery
    * Chuck Close's estate settles lawsuit against Cigna over medical bills
      July 13, 2024
      

 * BreakingviewsChevron
   Browse Breakingviews
    * Breakingviews Predictions
   
   Latest in Breakingviews
    * Now is least-bad time for JPMorgan CEO to move on
      July 12, 2024
      
    * Wall Street places reluctant bet on Trump
      July 12, 2024
      
    * Wall Street places reluctant bet on Trump
      July 12, 2024
      
    * Li clan take a tiny step to beat China value trap
      July 12, 2024
      

 * TechnologyChevron
   Browse Technology
    * Artificial Intelligence
    * Cybersecurity
    * Space
    * Disrupted
   
   Latest in Technology
    * OpenAI whistleblowers ask SEC to investigate alleged restrictive
      non-disclosure agreements
      July 13, 2024
      
    * Vietnam's VinFast delays US electric car plant amid market slowdown
      July 13, 2024
      
    * South Korea's SK On in talks to supply prismatic EV batteries as it seeks
      turnaround
      July 13, 2024
      
    * Southwest Air, Archer Aviation work on plans to fly air taxis in
      California
      July 13, 2024
      article with gallery

 * Investigations
 * MoreChevron
   Sports
    * Olympics
    * Athletics
    * Baseball
    * Basketball
    * Cricket
    * Cycling
    * Formula 1
    * Golf
    * NFL
    * NHL
    * Soccer
    * Tennis
   
   Science
   Lifestyle
   Graphics
   Pictures
   Podcasts
   Fact Check
   Video
   Sponsored Content
    * Reuters Plus
    * Coupons
   
   Trending Stories
    * Worldcategory
      Trump survives assassination attempt at campaign rally after major
      security lapse
      article with video
    * Worldcategory
      Here's what we know about Thomas Matthew Crooks, the suspected Trump rally
      shooter
      article with video
    * Worldcategory
      Trump rally shooting: Focus on Secret Service
      
    * Worldcategory
      LIVE
      Trump Shooting Live: FBI names suspect in assassination bid
      

My News
Search
Sign InRegister
Menu
 * Macro Matters


BANK OF JAPAN OPENS DOOR FOR A HAWKISH DOUBLE SURPRISE

By Leika Kihara
June 26, 20241:07 AM GMT+2Updated 18 days ago
Save
Text
 * Small Text
 * Medium Text
 * Large Text

Share
 * X
 * Facebook
 * Linkedin
 * Email
 * Link


Maximize
Item 1 of 2 Bank of Japan Governor Kazuo Ueda attends a press conference after
its policy meeting in Tokyo, Japan, June 14, 2024. REUTERS/Kim Kyung-Hoon/File
Photo
[1/2]Bank of Japan Governor Kazuo Ueda attends a press conference after its
policy meeting in Tokyo, Japan, June 14, 2024. REUTERS/Kim Kyung-Hoon/File Photo
Purchase Licensing RightsNew Tab, opens new tab
ChevronChevron
TOKYO, June 25 (Reuters) - The Bank of Japan is dropping signals its
quantitative tightening (QT) plan in July could be bigger than markets think,
and may even be accompanied by an interest rate hike, as it steps up a steady
retreat from its still-huge monetary stimulus.
Hawkish hints delivered over the past week highlight the pressure the central
bank faces in the wake of renewed yen falls, which could push inflation well
above its 2% target by raising import costs.
Advertisement · Scroll to continue

Notwithstanding a market shock or severe economic downturn, a rate hike would be
on the table at each policy meeting, including July's, said three sources
familiar with its thinking.
"Given what's happening with inflation, interest rates are clearly too low,"
said one of the sources. "Much depends on upcoming data, but a July rate hike is
a possibility," another source said, a view echoed by a third source.
Advertisement · Scroll to continue

The BOJ kept interest rates steady around zero this month.
However, the board debated the need for a timely hike with one member signaling
the chance of doing so to prevent cost pressures from pushing up inflation too
much, a summary of the meeting showed on Monday.
That was largely read as a sign the bank is gearing up for near-term action.
Governor Kazuo Ueda told reporters after the meeting that a rate hike next month
cannot be ruled out.

Hiking rates at the July 30-31 meeting could have a huge impact on markets, as
the BOJ also intends to announce a detailed plan on how it would trim its
massive bond buying and reduce the size of its $5 trillion balance sheet.

Reuters Graphics
Ueda has said the BOJ could make a "sizeable" cut to its bond buying, suggesting
the scale of reduction could be large to ensure markets shake off the shackles
of yield curve control - a policy that was ditched in March.

As with other central banks, the focus of the BOJ would be to craft a QT plan
that avoids causing unwelcome spikes in bond yields.
But concerns over the weak yen also require the QT plan to be ambitious enough
to avoid underwhelming market expectations and triggering sharp declines in the
currency.
The trade-off means the BOJ will likely announce a plan to trim monthly buying
at a steady, set pace, while leaving some flexibility to adjust the speed as
needed, the sources said.

While there is no consensus within the bank on the details, one idea being
brainstormed is a design similar to the U.S. Federal Reserve's that mechanically
trims buying, albeit with more flexibility.
The BOJ can do this by indicating a narrow range, instead of a set figure, at
which it will trim bond buying. It can also insert an "escape clause" that
pledges to slow or temporarily halt tapering if markets become too volatile, the
sources said.
The bank will taper across various bond maturities in a way that does not cause
distortions in the yield curve, they said.
The BOJ will hold a meeting with bond market participants on July 9-10 to
collect their views on what kind of plan will work, a move one board member said
was aimed at ensuring it can trim buying "to a greater extent," the June meeting
summary showed.
Izuru Kato, chief economist at Totan Research and a veteran BOJ watcher, said
the central bank must balance the need for exchange rate stability with the need
for bond market stability.
For that reason, it may look to deepen the cuts to its bond buying each quarter.
"If the yen keeps weakening, the BOJ could do both the taper and a rate hike in
July," Kato said. "Just going with a taper might not be enough to prevent the
yen from falling further."

Get weekly news and analysis on the U.S. elections and how it matters to the
world with the newsletter On the Campaign Trail. Sign up here.

Reporting by Leika Kihara; Editing by Sam Holmes

Our Standards: The Thomson Reuters Trust Principles.New Tab, opens new tab

Save
Share
 * X
 * Facebook
 * Linkedin
 * Email
 * Link

Purchase Licensing Rights


READ NEXT

ChevronChevron
 * Sustainable Finance & ReportingcategoryAs Argentine inflation cools to single
   digits, residents are still skeptical
 * U.S. MarketscategoryUS producer price data points to subsiding inflation
   pressures
 * article with video
   ChinacategoryChina's exports top forecasts, but falling imports point to more
   stimulus
 * article with gallery
   IndiacategoryIndia's retail inflation reignites in June as food prices surge
 * Macro MatterscategoryUS equity funds see outflows on caution ahead of
   earnings reports
 * United KingdomcategoryMajor investors pile in to UK rental homes despite
   regulatory fears




MARKETSCHEVRON

 * article with video
   
   
   TAKE FIVE: CANCEL SUMMER?
   
   Take Fivecategory · July 13, 2024
   
   Pressure on Joe Biden to step out of the U.S. presidential election race,
   mounting expectations of a September Fed rate cut, Q2 earnings, an ECB
   meeting and Britain's king unveiling the legislative programme of the new
   Labour Government.

 * MarketscategoryTSX hits record high, Aritzia top performer after strong
   resultsJuly 12, 2024
 * MarketscategoryDollar falls vs. yen, global stock index up, with focus on
   rate cutsJuly 12, 2024
 * MarketscategoryIMF says emerging market capital inflows recover to 2018
   levelsJuly 12, 2024
 * article with gallery
   ANALYSISShunned UK markets emerge as haven from global stormsJuly 12, 2024




SITE INDEX


LATEST

 * Home
 * Authors
 * Topic sitemap


BROWSE

 * World
 * Business
 * Markets
 * Sustainability
 * Legal
 * Breakingviews
 * Technology
 * Investigations
 * Sports
 * Science
 * Lifestyle


MEDIA

 * 
   Videos
 * 
   Pictures
 * 
   Graphics


ABOUT REUTERS

 * About ReutersNew Tab, opens new tab
 * CareersNew Tab, opens new tab
 * Reuters News AgencyNew Tab, opens new tab
 * Brand Attribution GuidelinesNew Tab, opens new tab
 * Reuters LeadershipNew Tab, opens new tab
 * Reuters Fact Check
 * Reuters Diversity ReportNew Tab, opens new tab


STAY INFORMED

 * Download the App (iOS)New Tab, opens new tab
 * Download the App (Android)New Tab, opens new tab
 * Newsletters


INFORMATION YOU CAN TRUST

Reuters, the news and media division of Thomson Reuters, is the world’s largest
multimedia news provider, reaching billions of people worldwide every day.
Reuters provides business, financial, national and international news to
professionals via desktop terminals, the world's media organizations, industry
events and directly to consumers.


FOLLOW US

 * X
 * Facebook
 * Instagram
 * Youtube
 * Linkedin


THOMSON REUTERS PRODUCTS

 * WESTLAWNEW TAB, OPENS NEW TAB
   
   BUILD THE STRONGEST ARGUMENT RELYING ON AUTHORITATIVE CONTENT,
   ATTORNEY-EDITOR EXPERTISE, AND INDUSTRY DEFINING TECHNOLOGY.

 * ONESOURCENEW TAB, OPENS NEW TAB
   
   THE MOST COMPREHENSIVE SOLUTION TO MANAGE ALL YOUR COMPLEX AND EVER-EXPANDING
   TAX AND COMPLIANCE NEEDS.

 * CHECKPOINTNEW TAB, OPENS NEW TAB
   
   THE INDUSTRY LEADER FOR ONLINE INFORMATION FOR TAX, ACCOUNTING AND FINANCE
   PROFESSIONALS.


LSEG PRODUCTS

 * WORKSPACENEW TAB, OPENS NEW TAB
   
   ACCESS UNMATCHED FINANCIAL DATA, NEWS AND CONTENT IN A HIGHLY-CUSTOMISED
   WORKFLOW EXPERIENCE ON DESKTOP, WEB AND MOBILE.

 * DATA CATALOGUENEW TAB, OPENS NEW TAB
   
   BROWSE AN UNRIVALLED PORTFOLIO OF REAL-TIME AND HISTORICAL MARKET DATA AND
   INSIGHTS FROM WORLDWIDE SOURCES AND EXPERTS.

 * WORLD-CHECKNEW TAB, OPENS NEW TAB
   
   SCREEN FOR HEIGHTENED RISK INDIVIDUAL AND ENTITIES GLOBALLY TO HELP UNCOVER
   HIDDEN RISKS IN BUSINESS RELATIONSHIPS AND HUMAN NETWORKS.

 * Advertise With UsNew Tab, opens new tab
 * Advertising Guidelines
 * Purchase Licensing RightsNew Tab, opens new tab

 * CookiesNew Tab, opens new tab
 * Terms of Use
 * PrivacyNew Tab, opens new tab
 * Digital AccessibilityNew Tab, opens new tab
 * Corrections
 * Site FeedbackNew Tab, opens new tab

All quotes delayed a minimum of 15 minutes. See here for a complete list of
exchanges and delays.

© 2024 Reuters. All rights reserved






RIGHT TO WITHDRAW CONSENT UNDER GDPR

We and our 211 partners store and/or access information on a device, such as
unique IDs in cookies to process personal data. You may accept or manage your
choices by clicking below, including your right to object where legitimate
interest is used, or at any time in the privacy policy page. These choices will
be signaled to our partners and will not affect browsing data.Cookie
PolicyPrivacy Statement


WE AND OUR PARTNERS PROCESS DATA TO PROVIDE:

Use precise geolocation data. Actively scan device characteristics for
identification. Store and/or access information on a device. Personalised
advertising and content, advertising and content measurement, audience research
and services development. List of Partners (vendors)

Allow All Reject All Show Purposes


Feedback