BOJ Seen Holding Rates in Messaging Risk for Ueda as Yen Teeters

The Bank of Japan is widely expected to keep interest rates unchanged on Tuesday, setting up a communication challenge for Governor Kazuo Ueda as the foundering yen hovers near levels that have prompted past interventions.

Just weeks ago, markets and economists were betting Ueda and his board would press ahead with their normalization efforts and deliver another hike at the end of their two-day meeting on Tuesday. Those bets dissipated as US President Donald Trump’s war on Iran sent oil prices surging, with markets now pricing just a 7% chance of a move, and many economists switching to a June increase.