Analysis: With economic growth under pressure, the Japanese Prime Minister may wish to delay Bank of Japan’s interest rate normalization

Golden Ten Data reported on April 7 that BlueBay Chief Investment Officer Mark Dowding stated in a report that Japanese Prime Minister Sanae Takaichi is highly focused on achieving economic growth. From this perspective, it is believed that she may prefer to delay the Bank of Japan’s move toward interest rate normalization. However, he indicated that a more dovish Bank of Japan could raise concerns about a prolonged period of overshooting inflation, which would put pressure on the Japanese government bond yield curve. Mark Dowding said, "We remain optimistic that the 10- to 30-year Japanese government bond yield curve can continue to flatten further in the medium term."