Ino told CNBC on Friday. “However, considering the current trend of yen depreciation and the upcoming FOMC meeting just before the BOJ meeting, we should keep in mind that there remains a possibility of an abrupt decision to raise rates if the USD/JPY reaches levels like 155,” Ino said, referring to the Federal Open Markets Committee meeting scheduled this week. The yen was trading around 154 to the dollar on Monday morning. To be sure, some economists still expect the BOJ to tighten policy this week. Nomura expects the BOJ to raise its policy rate by 25 basis points on Thursday, citing fundamentals such as the economy and prices being on track. However, it also acknowledged that a hike might be delayed due to uncertainties surrounding U.S. policy. “We think the BOJ could also decide to put off any rate hike if it decides to place greater emphasis on uncertainties, including U.S. policy conduct and market trends (in the forex market in particular) during the Christmas season, when markets tend to be quiet,” research analyst Kyohei Morita said in a Dec. 11 note. The brokerage also pointed to uncertainty around the government’s fiscal support for households as a potential factor that might prompt the BOJ to hold off its rate increase. Prime Minister Shigeru Ishiba, whose government lacks a parliamentary majority, is currently in negotiations with opposition parties over the size of a proposed increase to the minimum annual taxable income threshold. Currency Risks