BoJ will need to take additional action sooner or later

BoJ is next in line for an even more expansionary monetary policy. It might take action as soon as tomorrow, as Japanese growth was flat in Q3 after negative growth rates in Q2. Inflation is hovering around zero and not moving towards the BoJ's inflation target of 2% at all. 

Wage growth is low and the JPY is not depreciating further. All this does not bode well for inflation, and the September CPI figures (due tomorrow) will support this view. 

This suggests that the BoJ will cut its growth and inflation forecasts in tomorrow's Monetary Policy Statement and use this forecast adjustment to justify an expansion of its QE programme. 

"However, this is a close call, particularly since the Fed is removing pressure for quick action on the part of the BoJ. Nevertheless, the BoJ will need to take action sooner or later, and this should drive USD-JPY higher in the medium term", says Commerzbank.