MUFG are expecting a Bank of Japan Yield Curve Control tweak at this week's policy meeting

<p>The Bank of Japan meet on the 27th and 28th. </p><p>Goldman Sachs expect a tweak:</p><p><a href="https://www.forexlive.com/centralbank/goldman-sachs-are-still-expecting-the-bank-of-japan-will-tweak-ycc-policy-this-week-20230724/" target="_blank" rel="follow" data-article-link="true">Goldman Sachs are still expecting the Bank of Japan will tweak YCC policy this week</a></p><p>But mostly expectations are for no change:</p><p><a href="https://www.forexlive.com/centralbank/bank-of-japan-meet-this-week-july-27-28-no-change-seen-to-yield-curve-control-ycc-20230723/" target="_self" rel="follow">Bank of Japan meet this week, July 27-28 – no change seen to yield curve control (YCC)</a></p><ul><li><a href="https://www.forexlive.com/centralbank/october-is-now-the-month-most-cited-as-the-likely-timing-for-a-boj-policy-change-20230720/" target="_blank" rel="follow" data-article-link="true">October is now the month most cited as the likely timing for a BOJ policy change</a></li></ul><ul><li><a href="https://www.forexlive.com/centralbank/bank-of-japan-governor-ueda-comments-this-week-have-watered-down-ycc-tweak-expectations-20230719/" target="_self" rel="follow">Bank of Japan Governor Ueda comments this week have watered down YCC tweak expectations</a></li><li><a href="https://www.forexlive.com/news/weekly-market-outlook-24-28-july-20230723/" target="_self" rel="follow">Weekly Market Outlook (24-28 July)</a></li><li><a href="https://www.forexlive.com/centralbank/week-ahead-highlights-include-fomc-us-gdp-pce-ecb-boj-flash-pmis-20230723/" target="_self" rel="follow">Week ahead highlights include: FOMC, US GDP, PCE; ECB, BoJ; flash PMIs</a></li></ul><p>This summary is from eFX on what MUFG are expecting:</p><p>Key Points </p><p>
1. Recent CPI Data: The latest Japanese CPI report showed that both headline and core inflation increased to an annual rate of 3.3% in June. Even after eliminating energy costs, the BOJ's core inflation indicator remains high at 4.2%. </p><p>2. Anticipated Inflation Trends: Inflation is predicted to decelerate through the latter part of the year, largely due to the disinflationary influence of falling energy and food costs. </p><p>3. BoJ Policy Pressure: If inflation remains more persistent than anticipated during its decline and there's a continuous surge in wage growth in the second half of the year, the BoJ might face increased pressure to tighten its policy. </p><p>4. YCC Adjustment: MUFG's Tokyo analysts remain firm in their view that the BoJ will make adjustments to the YCC in the upcoming meeting, potentially leading to a stronger yen. However, they believe it might take more time for the BoJ to completely end negative rates in Japan.</p><p align="left">
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This article was written by Eamonn Sheridan at www.forexlive.com.