Moody's: Due to uncertainty, the Bank of Japan will continue to hold steady

Moody's analyst Stefan Angrick stated that the Bank of Japan will adopt a wait-and-see approach at next week's meeting. The economist noted that, despite better-than-expected GDP growth, stubborn inflation, and new yen depreciation making interest rate hikes possible, policymakers may remain cautious amid domestic and international political uncertainties. The resignation of Japanese Prime Minister Shigeru Ishiba has disrupted the policy outlook, and the overseas situation is not much better, with lingering doubts about the US-Japan trade agreement. Meanwhile, Japan's exports and industrial output are weakening, and consumer spending is also shrinking. Angrick wrote, "Demand-driven inflation is not sufficient to justify an interest rate hike this month." This does not mean that the Bank of Japan cannot raise rates, but given the unstable economic outlook, policymakers may prefer to be more explicit