BOJ Decision Looms Large Amid Rising Asian Stocks and Dipping Oil Prices
Asian stocks rose on Friday as oil prices dipped and investors awaited the Bank of Japan's monetary policy decision. The dollar held its ground, and bond prices steadied after a brutal selloff earlier this week.
The war in the Middle East continues to drive inflation fears globally, with oil prices above $100 per barrel. However, hopes for alternative oil supply routes pushed Brent crude futures down 1% to $103.77 a barrel.
Traders also took cues from Wall Street's overnight rally, led by beaten-down tech stocks. The Bank of England warned that it may have to hike interest rates if the Middle East war drags on, while the Federal Reserve raised rates for the first time in three years and flagged more hikes in the coming months.
The yen softened to 156.23 per US dollar as traders braced for the BOJ's policy decision later in the day. Michael Wan, currency strategist at MUFG, noted that 'the key is not just whether BOJ hikes, but also how it hikes and the communication by Governor Ueda on the path moving forward.'