BOJ expected to hold rates; markets look to Ueda for December hint
According to Dow Jones Newswires, the Bank of Japan is virtually certain to keep its policy rate at 1.25%. Focus shifts to Ueda's guidance on the next hike.
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what happened
The Bank of Japan is expected this week to keep its key rate at 1.25%, a three-decade high, according to Dow Jones Newswires. The central bank is pausing to assess how earlier increases are feeding into inflation and growth. Overnight swaps price roughly an 80% chance of a 25-basis-point increase to 1.5% in December.
Attention will center on Governor Kazuo Ueda's post-meeting briefing and the quarterly outlook report. People familiar with the bank's thinking name the Middle East conflict, yen weakness and AI-related demand as the main risks. The yen remains near 160 per dollar, which keeps import prices under upward pressure.
why it matters
Markets will read Ueda's wording closely. Saying decisions will be made "at every meeting" is neutral, while a shift toward "upcoming meetings" would strengthen the case for a December hike. The Federal Reserve's meeting, held first, will also shape the yen.
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- BOJ Rate Hold Seen as Done Deal, Putting Focus on Guidance — Dow Jones Newswires, 28 October 2026 at 04:36 UTC
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