It’s a busy schedule today.
Bank of Japan Governor Ueda speaks. Yesterday we heard from the Deputy Governor Himeno.
- Himeno confirmed that the Bank of Japan intends to continue raising interest rates and adjusting the degree of monetary easing in line with economic activity, prices and financial conditions.
- He said that the Bank of Japan will take into account the timing and pace of future adjustments while monitoring how developments in the Middle East affect the Japanese economy and the possibility of achieving the basic scenario.
- Himeno described the increases in long-term interest rates as reflecting global concerns about inflation, and said the Bank of Japan would assess bond market conditions and functions while reviewing the tapering plans.
I doubt Ueda’s message today would be much different. The next Bank of Japan meeting will be held on June 15-16, 2026. Expectations are increasing for a 25 basis point interest rate hike.
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Next up is Neel Kashkari, president and CEO of the Federal Reserve Bank of Minneapolis. previously, Kashkari pointed to Nikki Continued inflationary pressures from instability in the Middle East could push the Fed toward a series of interest rate increases.
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The April Consumer Price Index (CPI) is scheduled to be released from Australia. I will have more to talk about separately. Previous preview here.
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The Reserve Bank of New Zealand is likely to issue a decision today to keep interest rates at 2.25%.
Almost unanimous Some economists point out that the Reserve Bank of New Zealand is keeping the official interest rate at 2.25% at today’s meeting, although expectations after that date have changed significantly. Just over half of survey respondents now expect the OCR rate to reach 2.50% or higher by the end of the third quarter, a sharp reversal from April when less than a third expected a rise by that point. The average end-of-year forecast also rose, rising to 2.75% from 2.50% in the previous survey.
The tight repricing reflects the deteriorating inflation picture. Consumer prices in New Zealand rose 3.1% in the latest quarter, once again breaching the top of the central bank’s 1-3% target range, with oil trading above $100 a barrel for most of the past two-and-a-half months as a key upside risk. Interest rates are expected to rise from July, driven by highly skewed upside risks to inflation expectations and concerns that price pressures could spill over from fuel to services and wages.
An hour after the statement is issued, Reserve Bank of New Zealand Governor Berman will hold a press conference.
