US Retail Sales Data, FOMC and Bank of England Meetings: Macro Week Ahead

At the Monetary Policy Meeting held today, the Policy Board of the Bank of Japan decided, by a unanimous vote, to set the following guideline for money market operations for the intermeeting period: The Bank will encourage the uncollateralized overnight call rate to remain at around 0.5 percent Regarding the reduction of its purchase amount of Japanese government bonds (JGBs), the Bank decided, by an 8-1 majority vote, on a plan to reduce the amount of its monthly outright purchases of JGBs so that it will be about 2 trillion yen in January-March 2027. The amount will be cut down, in principle, by about 400 billion yen each calendar quarter until January- March 2026, and by about 200 billion yen each calendar quarter from April-June 2026 (see Attachment).1 |NoIc| BOJ: TO REDUCE AMOUNT OF MONTHLY JGB PURCHASES SO IT WILL BE ABOUT 2 TRILLION YEN IN JANUARY-MARCH 2027 TO LEAVE UNCHANGED EXISTING BOND TAPER PLAN RUNNING THROUGH MARCH 2026 LONG-TERM INTEREST RATES ARE TO BE FORMED IN MARKETS APPROPRIATE FOR BOJ TO REDUCE BOND BUYING… BOJ: Frontloading observed in production, exports BOJ: NECESSARY TO PAY DUE ATTENTION TO IMPACT OF TRADE POLICIES ON FINANCIAL, FX MARKETS INFLATION EXPECTATIONS HAVE RISEN MODERATELY EFFECTS OF THE PAST RISE IN IMPORT PRICES AND OF THE RECENT RISE IN FOOD PRICES ARE EXPECTED TO WANE BOJ: Price trend likely in line with goal in outlook for the 2nd half

G7: WE HAVE BEEN CONSISTENTLY CLEAR THAT IRAN CAN NEVER HAVE A NUCLEAR WEAPON. G7: URGE THAT THE RESOLUTION OF THE IRANIAN CRISIS LEADS TO A BROADER DE-ESCALATION OF HOSTILITIES IN MIDDLE EAST, INCLUDING A CEASEFIRE IN GAZA. G7: WE REITERATE OUR SUPPORT FOR THE SECURITY OF ISRAEL. G7 STATEMENT - WILL REMAIN VIGILANT TO THE IMPLICATIONS FOR INTERNATIONAL ENERGY MARKETS AND STAND READY TO COORDINATE

BoJ's Governor Ueda: We considered market participants’ views for bond plan. BoJ Gov Ueda: Will Conduct Mid-Term Assessment On Bond Plan Next June - Appropriate To Reduce Bond Buying In Predictable Manner - Japan's Economy Is Recovering Moderately, Although Some Weak Moves Are Seen - Easy Monetary Conditions Will Support Economy BoJ's Governor Ueda: We showed JGB buying plans through March 2027 to allow flexibility, predictability. BoJ's Governor Ueda: Japan's economy is recovering moderately, although some weak moves are seen. BoJ Gov Ueda: Will Respond Nimbly In Case Of Rapid Rise In Long-Term Interest Rates Such As By Increasing Bond Buying, Conducting Fixed-Rate Bond Purchase Operations, Using Fund-Supply Operations Against Pooled Collateral