Breath. Reports about the scrapping yield curve control along with buying of etfs and all with rate hike potentially. Lets look at how markets and japan are faring. You get the sense regardless of the normalization of policy, markets believe the nikkei can run higher. The fundamentals are intact amid all this Corporate Governance improvement. We saw it decline in the morning session but it did close 2. 7 higher just yesterday. We see in the options market, for example, the contracts for the strike price above the 41,000 level. Those were actively traded. Regardless of the normalization we see today, we still need to see negative real rates persist. That will mean yields will take a while to climb in japan. Between the u. S. And japan, given the yield gap, that will put pressure on the yen. The yen has been well behaved. You feel the sense that the feds move will matter more for this currency pair. Lets take a look at how it has been faring since the past four months. Based on the implied volatility, it has been very tame. We saw the meeting in december and january where that moved a little, but that has been picking up. We will be honing in on the boj today. Haslinda it is about the boj but it is not the only game in town. It is also about the rba. Avril how can we forget . The reserve bank of australia. Hold is expected, but some pockets of the market believe it could soften the hawkish buyers, because of slightly looser labor market along with inflation easing. You can see on bonds, in the equity space, we are seeing markets in waitandsee mode regardless, we could see further pressure on the currency. The aussie. As we see the chinese economic weakness come through, it is under pressure given the slump in iron ore prices. That is where we are seeing cross assets in australia. What else in the asiapacific we are seeing, watching nvidia unveiling the ai processor. It more or less underwhelmed or failed to excite markets. The Semiconductor Stocks in the asiapacific, slumping. Chinese Developers Come on watch. News lines from evergrande accused of inflating its revenue so that is what we are seeing at the moment in the markets. Haslinda thank you so much for that. Lets get to where the action is. For the latest on the boj Rate Decision, Stephen Engle is at the Central Bank Headquarters in tokyo. We have been waiting for this. It is expected to be the first move since 2007. Stephen thats right. We will be waiting and we are waiting on the bloomberg terminal on our phones, waiting for headlines to cross. The policy statement from the bank of japan, the headquarters behind me, our last guest in the last hour told me it might be a little later than usual this time because of the widely reported changes to the negative Interest Rate policy as well as the reported scrapping of the yield curve control, as well as the scrapping of future purchases of etfs. There is a lot to go through. It may take more time. We are waiting here to hear that. This is a momentous occasion for Japanese Monetary policy. The first time a hike from the boj has come in 17 years at the end of an era of obviously negative rates. The questions Going Forward, what will be the post why sisi ycc policy on bond purchases . What will happen with Current Holdings of etfs . Lots of questions, although so much of this is baked in given the fact that there were those proprietary stories from the nikkei not only yesterday, but early this morning at 2 00 a. M. A lot is baked in but there are many questions. We will hear from the governor at the 30 local time. 3 30 local time. Haslinda how much clarity are we expecting today . Stephen interesting question. He still wants to show he has an accommodative stance and will not tighten too quickly. We dont expect any type of clarity from the governor on future rate hikes. Will it be one and done . We are not sure. Our last guest essentially said yes, it should be one and done but i doubt whether the governor will be basically telegraphing that. There is also the risk as well of being too dovish, because if he is, that could underline or undermine the conviction to a and negative Interest Rates. There is lots and lots of things , and a balancing act the governor needs to have today. Lets talk more about this with our guest. You were here with us in january. We thought it was going to be april. Was that the Wage Negotiations that pushed it over the edge to say it will be now, mark . Yes. The Wage Negotiations, the number came out last friday. That was 5. 3 , surprisingly strong. Forecasts were 4 . Last year it was 3. 6 , higher than those numbers. I think the boj will be convinced it is not the time to move. Stephen you are the former assistant governor of the bank of japan. How much of a struggle has this been over the last six weeks or so between the last meeting and now to make this decision . Kazuo i think watching the negotiation numbers, the atmosphere of society around the policy decisions potentially taking taken by the boj, they have to convince the general public how to the general public and politicians. This is the time for the boj to have enough information to be convinced that this is the right time to do that. Stephen you believe it is and will be one undone, there wont be more hikes the rest of the year. Kazuo depends on the wages Going Forward. Given the current we observed, it is hard for me to have a lot of subsequent hikes this year. At the most, one hike would be all we get for the rest of the year. Possibly there is no hike at all. It is still possible scenario. Haslinda if it does have one undone, if it is one and done, what impact might that have on financial conditions . Kazuo financial conditions, they will not change much because of the overhaul of the divisions. And the market framework. The boj carefully paved the way for todays decision so even though scrapping etfs and everything else, the existing condition has not changed so much. Haslinda after what we see today, what further steps are needed for policy normalization . What are we expected to see from the boj . Kazuo obviously Monetary Policy everywhere in the world is aiming for price stability. In the context of boj, 2 deflation would be the first, most important question. So far i have been seeing a little bit short of 2 with pressure. I think the boj will continue carefully assessing what will take place, particularly wage hikes is already enough. How do wage hikes translate into the broader boj will look at for the next few months . I think that will be a key question. Probably we will have a more comprehensive picture and information. Stephen how much of a delicate balancing act does the governor have to have in the press conference at 3 30 . Doesnt want to be too dovish that it undermines essentially the conviction to exit negative Interest Rates but he doesnt want to be too hawkish. Maybe the fundamentals of the economy are not there. Kazuo exactly. I think he has to take into consideration the current financial conditions. It doesnt make a lot of difference to that. If he is too dovish, that could weaken the yen further. If he is too bullish that could raise pressure on Interest Rates. I think he will have to balance these conditions. It is a hard task. Stephen why hasnt the yen appreciated much . Hasnt moved at all. It is staying fairly we got one 49 fairly we at 149. Kazuo you have to look at the Federal Reserve story. We are expecting rate cuts this year. That would be important element compared to that situation, the Federal Reserve. Haslinda how do you think the boj views the weakness of the currency . Kazuo for the last 12 years, weakening of the currency has been unpopular among the publics of the boj doesnt want the yen to depreciate much further. The boj knows they cant control the yen. So they will try to walk the tightrope in terms of the impact on the exchange rates. There will be challenges arising in terms of communication. Stephen mommasan, if we assume they will scrap the yield curve control, what is a post ycc Balance Sheet policy look like . Kazuo from the boj officials, the discontinuity of financial conditions including Interest Rates. The boj buying ggp regardless of the scrapping of ycc, it will be the same as they have been doing so i think they will keep holding some ggp ggp. I think it will be around the same for the time being. The investment policy is part of the decision. Stephen thank you so much. Stay here because we havent gotten the decision yet. We will be coming back to mommasan as soon as we get the decision from the boj. It could be a little longer than usual but we will be here waiting. Haslinda no stranger to the weight. Former bank of Japan Assistant manager minister. You can turn to the terminal for more boj coverage. Get commentary and analysis from bloombergs expert editors. Still ahead, Market Analysis with federal capital. Why they think easy money has been made in japanese risk assets. First, the rba looks to extend its rate close for a Third Straight meeting. We will look at what to watch and policymakers comments. Here is one big interview we want to tell you about. We will be speaking exclusively with president of the philippines ferdinand marcos, jr. About rising tensions in the South China Sea and the countrys delayed southern sovereign wealth fund. Keep it here with us. This is bloomberg. Thanks to avalara, we can calculate sales tax automatically. Avalarahhhhhh what if tax rates change . Ahhhhhh filing sales tax returns . Ahhhhhh business license guidance . Ahhhhhh crossborder sales . Ahhhhhh item classification . Ahhhhhh does it connect with acc. . Ahhhhhh ahhhhhh ahhhhhh [alarm beeping] amelia, turn off alarm. Amelia, weather. 70 degrees and sunny today. Amelia, unlock the door. Im afraid i cant do that, jen. Why not . Did you forget something . My protein shake. The future isnt scary, not investing in it is. Youre so dramatic amelia. Bye jen. 100 innovative companies, one etf. Before investing, carefully read and consider Fund Investment objectives, risks, charges expenses and more in prospectus at invesco. Com. Haslinda im back to Bloomberg Markets asia. Awaiting the boj decision. Will they make a move . Ueda proposing changes to policy and the days leading up to today, we have heard from a lot of media and japan proposing the change is coming at this meeting. Lets get insights and bring in paul allen. Lets start with the boj. Reports suggest changes coming. Change had better becoming if they dont want to set off some strong market reactions. It has been so well flagged. Will they drop yield curve control today as well as getting rid of negative rates . How do they manage the yield curve control . All of that becomes more important, you would think, then the negative rates side of things. Especially providing they make it clear that as they have flagged before, one rate hike doesnt mean there are more to follow in the near future. That is the scenario that the markets have been expecting and what has helped drive up stocks, keep the yen contained and also, japanese bonds trading without too many eruptions. I would be surprised if they dont deliver something along those lines. Surprised the boe surprise and the boj often go handinhand. Haslinda it is so well flagged, yet some are bracing for some kind of madness. What could go wrong to cause market eruptions . Garfield getting at the statement first, the governors appearance aside, in a statement, do they do enough to make it clear what their plans are Going Forward . Have they provided a straightforward yes, we have negative rates . Maybe they are moving towards 00. 1 for the shortterm rate. What are they doing with the yield curve control . Is it something simple which outlines, yes, we no longer have a yield target of any sort, but we will continue to buy bonds in the market in order to avoid wild fluctuations, to prevent moods getting divorced from reality or Something Like that . If they simply get rid of negative rates and leave Something Like yield curve control, getting out of that will be studied, likely to be studied in coming meetings without giving too much in the way of guidance, that is the sort of thing that could set off very strong moves in the yen initially, because probably if they get the decision out in time, bond futures wont be trading, let alone cash bonds. But we will see. That is one of the other difficulties. Because they are taking their time with the decision, they could come out after the lunchtime break is finished or close to when it finishes. That has traditionally helped, adds a disruption in markets on the day. Haslinda all, paul, it is also decision day for the rba. It is about the messaging. Paul that is right. We arent expecting a move unlike the bank of japan but we are expecting the rhetoric, in the minutes of the last meeting we heard a rate increase was on the table for the reserve bank of australia. But they didnt wind up going down that path. It did illustrate what priority inflation is for the rba and that was reflected in their decision at the last meeting. In a statement, inflation is a priority, right now 4. 1 but the number in january, the monthly indicator was 3. 4 so it is at least heading in the right direction. Still outside the reserve bank target. Other things to watch around inflation, or unemployment also coming in a bit higher hotter than usual in january. The conversation around the possibility of a technical recession and australia is a live one. That will be something for the rba to consider. As for the decision, no change, 4. 35 percent but the language will be important. Haslinda it is still tricky for the rba. It is stuck between the boj and the fed. Garfield sorry. Can you repeat the question . Haslinda this is tricky for the rba, it is stuck between the boj and the fed. Garfield you mean the rba is stuck as well because its economy is actually performing worse than a lot of other economies. There is that pressure towards may be, they have done enough on the rate hike front, but then come on the other things, they dont really want to go down that path until they are clear the fed will go down that path because of the potential impact on the currency. So to some extent, the rba may actually be happy with the fed and the boj taking so much of the focus right now on the other hand, precisely because of that, their hands are kind of tied. They are definitely stock stuck with a very difficult art if they want to shift policy. By the same token, beating stuck on the policy front means the extra focus on what they say, they could readily Say Something that is interpreted as signaling they are more dovish than they intend to be, especially if that is compared with what is going on with the fed. Haslinda paul and garfield reynolds, thank you for your insights. The rba, said with its decision at the bottom of the hour. Boj meantime, we are still waiting. Just a tad higher versus the u. S. Dollar. Plenty more ahead. Keep it with us. This is bloomberg. Haslinda a big day for markets. Expecting the boj with its decision any time now. The rba set to come up with the decision at the bottom of the hour. Asian equities slipping before those decisions, in particular that of the boj where authorities are likely to bring an end to the worlds longest negative rates regime. It is trading lower for the nikkei 225. The yen, a tad higher versus the u. S. Dollar. A trillion dollar plenty more ahead with the rba decision minutes away. Keep it here with us. This is bloomberg. No matter what youre up against, we have your back. We are united way. We are neighbors helping neighbors in communities around the when disaster strikes we get you back on your feet. We help children build brighter. Weve been here for over 135 s but now our work is more. Join us. Join your neighbors. Join united way. Haslinda we are awaiting the rba Rate Decision due just moments. We are expecting the rba to stand pat for a third meeting. It is expected to keep rates at a 12 year high as australias economy shows signs of slowing further. Unemployment also trending higher. The Property Market remains pretty hot. It is expected to, up with a pretty hawkish tone. Some expecting a slight tightening bias. Recent data has been consistent with progress towards the rba target. All of this against a black door up a backdrop of sticky inflation in the u. S. We are awaiting the fed decision. Powell and friends have said they are not in a hurry to cut rates anytime soon. Taking a look at where we are in terms of how the index is doing, currently up by about zero. 1 . The aussie dollar at 65. 59 versus usd. We are waiting for the rba Rate Decision. Expectations are it will stand pad for a third eating in a row, on the back of the economy sharing signs showing signs of some weakness. A hawkish tone is expected from the rba on the back of the pretty hot property sector. Paul, lets get your take on what is happening and what is expected from the rba. No change, which is no surprise. The cash rate stays at 4. 53 for a Third Straight meeting, a 12 year high. Now the tricky part begins, picking through the statement to figure out where we are heading next. Here are some of the highlights from the statement. The board of resolute and determination to get cpi back to target, echoing some of the remarks we saw at the last decision, that inflation remains a priority for the rba, running at 4. 1 at the moment. But the monthly january figure was down to 3. 4 . It is heading in the right direction. The rba also saying, to that point, inflation continues to moderate but remains high. The wage growth level is consistent with the inflation target as well. Services inflation, however, remains elevated. Services inflation is moderating at a more gradual pace. Some words on household consumption, remaining particularly weak, something the rba expressed concern about at its last meeting also,