The bullish narrative global investors are running with is that the U.S. economy will achieve an improbable soft landing, giving the Fed room to pivot towards rate cuts earlier than many had thought.
Even the cautious postures of the ECB and BoE chiefs couldn’t dampen the mood.
But the parade of key central bank decisions that dominated this week still has further to run, with the Bank of Japan convening a two-day meeting from next Monday.
Speculation for an imminent end to negative rates may have come off the boil, but if December gets a bye, the next opportunity is only a month later, and markets seem to be bracing for Governor Kazuo Ueda to prepare the path at his press conference next Tuesday.
What it means for markets isn’t clear, but the BOJ’s position as a dovish outlier has provided an anchor for global bond yields throughout 2023.
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Graphics are produced by Reuters.
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/cloudfront-us-east-2.images.arcpublishing.com/reuters/LIF65EM5ORL3VPLGXLS4OC3X7E.jpg "Fed feted, Ueda awaited 40")
