JPMorgan: The Bank of Japan is expected to cut interest rates in September
The reaction of the chain as a result of expectations of an interest rate cut in the US is already here, and the Bank of Japan will react to the Fed’s moves and lower the interest rate to minus 0.3 percent. At the same time, the bank may announce an increase in the rate of ETF purchases
While the focus of investors is now focused on expecting a rate cut in the US in the near future, JPMorgan said tonight that the BOJ, a no less significant factor in the FED market, is expected to respond to recent developments and lower the interest rate from minus 0.1 To minus 0.3% this September.
If the Fed actually cuts interest rates as the market estimates (50 basis points by September), the Bank of Japan will have to react in order to prevent a drop in interest rates between the two countries, which will lead to the appreciation of Japanese yen and further deflationary pressure On the state.
The Bank of England is expected to reduce its target for 10-year bond yields, while the bank is expected to provide some compensation to the banks as a result of the expected damage to profits due to low interest rates, ETF in the stock market from 6 trillion yen to 8 trillion yen.
It should be noted that the Japanese currency strengthened significantly in the recent period due to uncertainty in the markets, since the currency is considered a “security asset.” The US administration has released more than $ 220 billion in the past month.