The Bank of Japan walks a tightrope: struggling to balance between yen depreciation and political pressure.

Jin10 data reported on October 30, U.S. financial website investinglive analyst Eamonn Sheridan stated that the market firmly believes that the appointment of Japanese Prime Minister Fumio Kishida will mean that the loose monetary policy will be maintained for a longer period. However, potential economic data suggests there may be reasons to adopt a more hawkish stance, including: the Tankan survey showing a moderate improvement in the confidence index of large manufacturers in September, wage growth and Inflation gradually reinforcing each other, and the overall economy remaining resilient despite the U.S. imposing tariffs. Nevertheless, Bank of Japan Governor Kazuo Ueda still maintains a cautious tone, emphasizing the need to coordinate with the new government before adjusting interest rates. Ueda stated that the results of the Tankan survey have not yet reflected the drag caused by U.S. trade measures. At the same time, political coordination may delay the next steps, as the new government could choose to ask the Bank of Japan to postpone policy adjustments. Most analysts expect the Bank of Japan to keep interest rates unchanged at today's meeting while retaining the possibility of tightening policy later. Ueda may emphasize that further depreciation of the yen could drive up import prices, thereby exacerbating Inflation, a concern that may resonate with Kishida. Kishida has identified the cost of living pressure as a core political issue.