Svmuu News: Sources say that the new round of market volatility triggered by the Middle East conflict has increased the likelihood that the Bank of Japan (BOJ) will pause interest rate hikes in March, as policymakers need more time to assess the impact on the economy. The only factor that might prompt the Bank of Japan (BOJ) to raise rates at its March 18–19 meeting is a sharp depreciation of the yen.Following U.S. strikes against Iran, investors flocked to the safe-haven U.S. dollar, putting pressure on the yen and pushing it close to the 160-yen-per-dollar mark. However, as the Middle East conflict escalates, impacting financial markets and driving up oil prices, the recovery outlook for an economy highly dependent on imported fuel has been clouded, raising the bar for a March rate hike.Sources noted that the central bank is carefully assessing the impact of the new round of geopolitical crises on monetary policy. After Deputy Governor Ryozo Himeno of the Bank of Japan (BOJ) failed to send a clear signal on Monday regarding an upcoming policy adjustment, the market also scaled back its bets on a March rate hike. Bank of Japan (BOJ) The lack of hawkish signals from senior officials stands in contrast to previous practice, when officials typically provided advance hints to avoid catching the market off guard. (Jin Shi)