The Bank of Japan is expected to keep its policy rate unchanged after its two-day meeting concludes Friday on concern that any hint of hawkishness could destabilize markets already unsettled by a strengthening yen.
The Liberal Democratic Party presidential election, in which the winner is likely to be Japan’s next prime minister, may also be a factor.
A surprise rate hike by the BOJ in July “brought a huge turmoil to the markets. It will still take some time to monitor that impact,” Masamichi Adachi, chief Japan economist at UBS Securities, wrote in a recent report.
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