Moody's: Bank of Japan will remain silent due to uncertainty

According to Golden Finance, Moody's analyst Stefan Angrik said that the Bank of Japan will choose to wait and see at its meeting next week. The economist said that while better-than-expected GDP growth, tenacious inflation and a new depreciation of the yen make rate hikes possible, policy makers may remain cautious in amid political uncertainty at home and abroad. Japanese Prime Minister Shigeru Ishiba's resignation disrupted the policy prospects, and the overseas situation is not much better, and doubts about the US-Japan trade agreement still exist. Meanwhile, Japan's exports and industrial output are weakening, and consumer spending is shrinking. "Demand-induced inflation is not enough to guarantee a rate hike this month," Angrick wrote. This is not to say that the Bank of Japan cannot raise interest rates, but policy makers may want to be clearer given the volatile economic outlook.