The Bank of Japan is investigating a sudden spike in access to its website when some market participants were unable to access the central bank's closely watched interest rate hike announcement on Wednesday.
In the minutes before the announcement at 12:56 p.m. local time, some people trying to access the Bank of Japan's website received a message saying it was temporarily unavailable due to "network congestion or other problems."
It was not clear whether the site was open to everyone at the same time or if some market participants gained access before others. A Bank of Japan spokesman said the central bank was investigating the cause of the problem and had no further information at this time.
Unlike central banks in other major developed economies, the Bank of Japan does not have a set timeline for releasing monetary policy decisions, leaving traders and others looking to get the latest information in a quandary even when the website is not disrupted.
“People are frustrated. The results came too late,” said Shoki Omori, chief strategist at Mizuho Securities. “While traders were already positive about the rate hike, they just wanted the results to come out quickly so they could adjust their positions, but they had to see the announcement and the website was down.”
Website outages are not unheard of before governments and central banks release important information, but they are rare. In the United States in 2020, the local Department of Labor website was overwhelmed during the COVID-19 pandemic, so much so that network crashes and data problems affected the release of data by the Department of Labor.
The Bank of Japan decided on Wednesday to raise its policy rate to 0.25% and announced plans to reduce the pace of monthly bond purchases to about 3 trillion yen ($19.6 billion) by the first quarter of 2026. Bank of Japan Governor Kazuo Ueda did not rule out the possibility of another rate hike this year at a subsequent press conference.
The yen once approached the 150 mark against the dollar. Despite this, analysts and strategists said there are still many uncertainties in the long-term outlook for the yen.
RBC Capital Markets said that from the perspective of expectations, I do not think that the Bank of Japan's statement will help boost the yen. Overall, this meeting is mixed for Japanese assets. Alvin T. Tan, the company's head of Asian foreign exchange strategy, said: "Considering the expectations of quantitative tightening relative to 1 trillion yen and the market's pricing of a 12 basis point rate hike, the Bank of Japan's decision today did not significantly exceed the market's hawkish expectations for this meeting."
StoneX Financial said many traders were just waiting for a signal to buy the yen, and they got it after Ueda's press conference. Mingze Wu, a foreign exchange trader at the company, said, "European traders started to be bullish on the yen after Ueda's speech, which may just be a delayed reaction."
Sumitomo Mitsui Banking Corp. believes that "while the FOMC meeting and U.S. employment data are coming, in the short term, the yen/dollar exchange rate may test the 150 level due to the support of the Bank of Japan for the yen. The Bank of Japan is willing to raise interest rates if the move is in line with the Bank of Japan's economic and price outlook. The focus on the exchange rate and the statement that '0.5% is not considered a specific interest rate ceiling' make us aware of the fact that the rate hike will be carried out quietly."
Article forwarded from: Jinshi Data
