The summary of the BoJ’s January policy meeting indicates that at least one member of the committee considers the current time to be a ‘golden opportunity’ to take policy action.  

Market surveys towards the end of last year pointed to April as the most favoured date for the first interest rate hike of the cycle, though some participants see risk of a move as soon as the next policy meeting on March 19.  

The window of opportunity for rate rises from the BoJ could be limited given expectations for rate cuts from the Fed and other G10 central banks this year.  

Our forecast of a move to USD/JPY 135.00 on a 12-month view assumes a rate rise from the BoJ this year. Since risks of a spring rate rise appear to have strengthened further, we have lowered our three-month USD/JPY forecast to 145.00 from a previous forecast of 146.00.