It is predicted that the BOJ will likely abandon negative interest rates in April, according to a majority of analysts.

In April, the Bank of Japan will end its eight-year negative interest rate policy, as predicted by over 80% of economists surveyed by Reuters, signaling a significant change from a central bank that has been an outlier globally.

At the upcoming BOJ meeting, nearly the same proportion of economists, 76%, anticipate the end of yield curve control, with almost all of them predicting an end to ultra-loose monetary conditions just months before many major central banks are expected to start cutting rates.

Despite Japan's economy slipping into a recession, the BOJ is expected to end negative interest rates in the coming months, according to previous sources.

According to a Reuters poll conducted from Feb. 15-20, 83% of 30 economists predicted that the central bank would abandon its minus 0.1% short-term deposit rate, which has been in effect since January 2016.

Based on the preliminary results of the annual labor-management wage talks for big firms and the hearings from BOJ branch managers on wage trends in small and mid-sized firms, the BOJ can make a decision at April’s meeting, according to Yoshimasa Maruyama, chief market economist at SMBC Nikko Securities.

In March, two entities, Daiwa Securities and T&D Asset Management, made their choice. Another entity opted for June, while two others chose 2025 or later.

As the uncertainty of foreign factors increases, the longer the BOJ waits, the more likely it is to miss the right moment for an impending policy shift, according to Mari Iwashita, Daiwa Securities’ chief market economist.

The percentage of economists who expect negative rate policy to be abandoned by the end of the year has increased from 82% in January's poll to nearly every economist, with 91% providing end-quarter rate forecasts.

Despite the central bank's decision to scrap negative rates, BOJ Governor Kazuo Ueda has emphasized that Japan's monetary conditions will remain accommodative.

In the poll, 86% of economists predicted that the BOJ would end YCC, while only four expected it to be modified. This is consistent with the results of the January poll.

In April, 19 out of 25 economists predicted that the central bank would dismantle YCC. Almost all of the 19 respondents believed that the end of negative rates would occur at the same time.

In the upcoming fiscal year, starting in April, big Japanese firms are predicted to have average wage growth and base salary increases exceeding this year's 3.58% by almost every economist, up from 90% predicted in January.

The poll increase was sharper for Japanese small and mid-sized firms, with 90% of economists expecting a bigger increase, up from 77% in January and 65% in November.

Economists predict that big companies will see pay increases ranging from 3.6% to 4.36% in mid-March, while overall businesses can expect pay increases between 1.5% and approximately 4.0%.