Thursday’s big news was a rate cut and additional quantitative easing from the European Central Bank. Some of that initial surge has already been erased, but the real question is what, if anything, this means for Japan.

Japan recently adopted its own negative interest rate policy. Its long-term bond yields even hit record lows in recent days. Even the 10-year Japanese government note went under the 0.00% mark.

24/7 Wall St. has looked for outside notes on what other central banks might be thinking. It turns out that Credit Suisse sees another rate cut by the Bank of Japan as likely by the end of April.

Credit Suisse’s report said:

We think it more logical to anticipate the Bank of Japan to center on lowering its Tier 3 rate of the IOER (interest on excess reserves, currently –0.1%) deeper into negative territory than expecting it to opt for an expansion to the QQE.

The firm did suggest that the Bank of Japan is likely to keep a status quo for the March 14 to March 15 meeting, but it said it would not be surprised if the Bank of Japan launches a pre-emptive strike. The firm thinks that this would be another 20 to 25 basis point rate cut for the Tier 3 rate, and it would be aimed at reducing the risk of a future yen appreciation.

The long and short of the matter is that Credit Suisse sees a high likelihood of the Tier 3 policy rate being lowered at the April 27 to April 28 Bank of Japan meeting, if not in March.

Now we just have to get past the March 5 to March 16 Federal Open Market Committee (FOMC) meeting. Federal Reserve presidents in the United States are more interested in raising rates while the rest of the world continues looking for ways to ease their rates into negative territory.

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