Will this week bring the long-awaited BoJ interest rate increase?

This week's macroeconomic calendar is filled with monetary decisions by central banks. Amid the thicket of information, the most important seems to be what the Bank of Japan will have to say, but Wednesday's FOMC decision will not go unnoticed. Will this week bring the long-awaited BoJ interest rate increase? Will gold return to growth? What next for the main stock indices?

Will the BoJ raise rates?

On the monetary decision Bank of Japan We won't have to wait long - it will fall on the night from Monday to Tuesday. At approximately the same time, we will also learn the RBA's monetary decision, but it is Kazuo Ueda and the potential change in the BoJ's actions that attract the attention of market participants. Why? The money market is currently pricing in the probability of a 10 bp increase in BoJ interest rates. at 55%. This is quite a lot considering that the last such move took place in 2007. An increase would mean that the BOJ is ending its negative interest rate policy after many years. The price increase scenario is also supported by, among others: better data on investment outlays, no purchase of Japanese ETFs, and finally rumors suggesting the BoJ's readiness to change its policy.

We cannot count on a change in the shape of monetary policy from the Fed - the Reserve will make a decision on this matter on Wednesday at 19:00. The market will wait for information on the date of the first rate cut. The latest inflation data do not indicate that the inflation situation in the US is under control, and retail sales data were also weak. However, please note that FOMC he doesn't like to change his mind abruptly - since the narrative was softened in December, the slightly dovish message will probably be maintained.

In today's webinar:

• ECB announces cuts?
• What's next with the price of gold?
• Will inflation surprise in the US?

About the host

Dr Przemysław Kwiecień - Chief economist X-Trade Brokers. Doctor of Economics at the University of Warsaw, graduate of the University of Warsaw and London Metropolitan University (MSc). Holder of the prestigious CFA certificate. He has been working for XTB since 2007, previously he gained experience as an advisor to the Minister of Finance, Mirosław Gronicki, and an economist at Bank Millennium. At XTB, he manages the Analysis Department.

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