Former central bank official: Bond purchase reduction slightly exceeded expectations; Uchida press conference may be dovish, Ueda’s health becomes key

(1) Tohru Sasaki, Chief Strategist at Fukuoka Financial Group and former Bank of Japan official, stated that a minor surprise concerned the scale of Japanese government bond purchases: the market originally expected no change after April next year, but in fact, there will be a slight reduction before remaining unchanged, which is somewhat different from the consensus. (2) The focus is on how Deputy Governor Shinichi Uchida will explain future policy. He needs to act prudently and will find it difficult to convey any major shift; therefore, the market may interpret his press conference as a dovish signal. (3) On the day of the rate hike, the Ministry of Finance may intervene due to the continued weakness of the yen. Looking ahead, Governor Kazuo Ueda's health issues are crucial; if he is replaced for health reasons, his successor is likely to be a dovish governor.