The Bank of Japan (BOJ) may pause its bond taper plan next fiscal year due to market volatility and political pressures, sources say.
At its June 15-16 meeting, the BOJ will review its tapering program and set a new plan for fiscal 2027. Despite no consensus, a pause is becoming the preferred option amid uncertainty over the Iran war and rising bond yields.
Political considerations under Prime Minister Sanae Takaichi also push for a pause, as higher yields could constrain her spending plans. Some analysts suggest a taper pause combined with a rate hike would stabilize markets.
