According to the economist, the Bank of Japan is expected to leave its main policy levels untouched Tuesday to support the pandemic-hit economy.

‘BOJ may leave its interest rate and assets purchase rate unchanged at the end of its two-day meeting. Also, it is expected for a rise in the estimated size of a BOJ loan program linked to government lending after Prime Minister Shinzo Abe’s administration announced an expansion of the lending measures last month’ as per the predictions of the economist.

“No big move doesn’t mean that the BOJ is free from any concerns,” said Tomo Kinoshita, global market strategist at INVESCO Asset Management in Tokyo. “The BOJ will be checking what else needs to be done and communicating its willingness to do more.”

It has to be noted that the volatility in the market last week is far better than that of March which has given yen stability and BOJ to stick at the same level for time being. Lifting of Japan’s state of emergency in late May and the gradual easing of lockdowns in key export markets has strengthened the economy.

Japan may restart business trips to and from Australia, New Zealand, Vietnam, and Thailand in the next few months was noted by the Yomiuri daily reported last week.

Up to 250 business travellers a day will most likely be allowed into Japan from the four countries, which have seen their infection situations stabilize, the newspaper said, without citing sources.”It is important to resume comings and goings of people partially and gradually,” the government spokesman told a regular news conference.

In another step to ease corona virus-related restrictions, the Tokyo metropolitan government is set to lift the “Tokyo alert”, issued last week to urge residents to keep their guard up, and allow more businesses to resume operations, public broadcaster NHK said.

USD/JPY 4 Hours Chart:

Support: 106.77 (S1), 106.19 (S2), 105.80 (S3).

Resistance: 107.74 (R1), 108.12 (R2), 108.70 (R3).

Expectation of Monetary Policy statement and lifting of corona virus lockdowns stabilizes Nikkie against dollar. We expect a bearish trend for USD/JPY.