Sources: The Bank of Japan may hold off on raising interest rates at its April meeting.

According to five sources familiar with the Bank of Japan's thinking, the central bank is unlikely to raise interest rates next week. The dwindling hope for a swift end to the Middle East conflict leaves Japan's economic and price outlook uncertain. While the final decision remains somewhat uncertain and depends on the progress of peace talks between the US and Iran, the sources said the central bank prefers to maintain the status quo this month to allow more time to assess the impact of the conflict. One source stated, "Given the current level of uncertainty, the Bank of Japan might consider maintaining the status quo this month feasible." Another source echoed this sentiment. A third source said the Bank of Japan is unlikely to raise rates, as the market has already fully priced in the possibility of no rate hike this month. These sources added that even if the Bank of Japan keeps rates unchanged next week, given escalating inflationary pressures, it is likely to signal that it is prepared to raise rates as early as June. (Jinshi)