The Bank of Japan is highly likely to maintain its current monetary policy at its two-day policy board meeting on July 30 and 31. The central bank just raised its policy rate to 1 percent in June, the highest level in about 31 years, and has determined that it needs to assess the effects of the rate hike for the time being. At the meeting, the BOJ will compile its latest outlook report and discuss an upward revision to its growth forecast for fiscal 2026, currently at 0.5 percent, given that downside risks to the economy are receding due to progress in alternative energy procurement despite lingering uncertainty over the Middle East situation, and in light of robust AI-related demand.
Bank of JapanBOJ maintains current policy, no change; impact on central bank itself is neutral.
BOJ keeps policy unchanged, no further tightening, which is negative for JPY (weakens JPY) so USD strengthens relative to JPY.