Barclays economists say the Bank of Japan will likely retain its forward
guidance but slightly adjust the wording. Current guidance states that, given
real rates are significantly low, the central bank will continue to raise policy
rates and adjust the degree of monetary easing to respond to developments in
economic activity, prices and financial conditions; Barclays expects the BOJ to
soften “real rates are significantly low” to “real rates remain low” or to
specify “real rates are still negative, particularly at the short- and mid-ends
of the curve.”
