Goldman Sachs: The Bank of Japan will continue to hold steady, with the next rate hike expected in January next year

【Goldman Sachs: The Bank of Japan will continue to hold steady, with the next rate hike expected in January next year】Goldman Sachs expects that the economic activity and price indicators released since the April monetary policy meeting continue to show an enhancement of the positive domestic cycle in Japan, but the impact of tariff increases may become apparent in the future. From a risk management perspective, in a highly uncertain environment, it is expected that the Bank of Japan will maintain its policy rate unchanged in June while keeping its gradual rate hike stance. We maintain our base scenario, believing the next policy rate hike will occur in January 2026. Regarding the Bank of Japan's mid-term assessment of the current plan to reduce government bond purchases (as of March 2026), we expect the existing plan to remain unchanged. Thereafter, we expect the Bank of Japan to continue reducing its bond purchases, albeit at a slower pace, but within a year, the Bank of Japan will accelerate the reduction of its bond purchase scale to around 2 trillion yen per month, which corresponds to the range of a survey conducted in advance with market participants and is consistent with the levels before the introduction of QQE.