Daiwa Securities: The Central Bank of Japan remains unchanged after the Fed's hawkish rate cut, and the yen may test new lows.

Krishna Bhimavarapu, Asia-Pacific economist at DWS Group Investment Management, said that despite the good economic data, the Bank of Japan did not raise interest rates earlier. This decision was made after the Federal Reserve cut interest rates by 25 basis points. Bhimavarapu said that although signs of the Federal Reserve taking a hawkish stance next year are becoming more apparent, the Bank of Japan’s inaction indicates that the yen may not only remain weak but also may reach new lows. The Bank of Japan also conducted a policy assessment, acknowledging the negative impact of unconventional monetary policy while assessing its overall positive impact on the economy. Bhimavarapu believes that this indicates that the Bank of Japan is unlikely to take any aggressive measures in the near term.