THE Bank of Japan, after clearly signalling last week’s interest rate hike, may return to its accustomed fuzzy guidance about central bank policy to maintain flexibility when it eventually begins to consider how much tightening is enough.
Recent data show Japanese workers are gaining better wages and are generally set to receive solid pay raises in their upcoming annual union negotiations
Setting rates in Japan will become a delicate balancing act if tariffs materialize.
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Asian shares advanced Friday after U.S. stocks rose to a record and the Bank of Japan raised its key lending rate.
Giving explicit advance signals, in addition to making the Bank of Japan feel boxed in, could breach Japanese law stipulating the nine-member board must debate and sign off on rate decisions at each policy meeting.
The Bank of Japan, after clearly signalling last week's interest rate hike, may return to its accustomed fuzzy guidance about central bank policy to maintain flexibility when it eventually begins to consider how much tightening is enough.
The BOJ fumbled its communication in December, surprising investors, but then telegraphed Friday's increase so unambiguously that the rate hike was 90% priced in.
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Shares were mixed in thin Asian trading on Monday after U.S. stocks edged back from their all-time high. Oil prices fell and U.S. futures sank, while Chinese shares shed some of their early gains after a survey of manufacturers showed export orders dropping to a five-month low.
Corporate earnings and key economic data from around the world will likely shape the direction of the stock market, keeping investors on their toes.