Mizuho: Bank of Japan's communication fails to prevent yen weakness, dovish signals may worsen depreciation

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智通财经2026/07/23 01:51

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Mizuho Securities economist Yusuke Matsuo expects that Bank of Japan Governor Kazuo Ueda will reiterate the stance of further rate hikes at next week’s press conference, but such remarks alone are unlikely to reverse the current weakness of the yen.
He pointed out that the market has largely priced in the expectation of a rate hike by the central bank every six months, so simply relying on communication adjustments will make it difficult to significantly strengthen the yen.
Given that the market generally expects the central bank to provide clearer guidance on the timing and pace of the next rate hike, any language perceived as dovish could further intensify downward pressure on the yen amid overall dollar strength.
Currently, mainstream market expectations are that the Bank of Japan will keep the policy interest rate unchanged at 1% next week in order to assess the impact of the prior rate hike on the economy.

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Mizuho: Bank of Japan's communication fails to prevent yen weakness, dovish signals may worsen depreciation

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