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Analyst: Resignation of Shizo Abe may Delay BOJ Rate Hike, Yen Weakness Could Widen
Summary: According to sources, Chris Weston of Pepperstone pointed out that the resignation of Japanese Prime Minister Shizo Abe has shifted focus to his successor and what this may mean for political stability. The market will weigh the extent of additional fiscal measures and budgets under the new leadership. 'The extent of fiscal stimulus is crucial ...
According to sources, Chris Weston of Pepperstone pointed out that the resignation of Japanese Prime Minister Shizo Abe has shifted focus to his successor and what this may mean for political stability. The market will weigh the extent of additional fiscal measures and budgets under the new leadership. 'The extent of fiscal stimulus is crucial in controlling the rise of long-term Japanese government bonds,' Weston said. These developments could be seen as another reason to delay the Bank of Japan's next 25 basis point rate hike until 2026. This expectation is already reflected in the market, with forward traders expecting only a 12 basis point hike by December. Weston noted that this is another reason why few are willing to hold the yen at the moment. He expects the yen's weakness in the Asian market to become more widespread.
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Link: Analyst: Resignation of Shizo Abe may Delay BOJ Rate Hike, Yen Weakness Could Widen [Copy]
