(Bloomberg) -- The case is building for the Bank of Japan to increase interest rates at its April meeting, as investors tighten their focus on the outcome of spring wage negotiations, according to strategists. 

The yen rose as much as 0.8% against the dollar and Japanese bond futures fell after BOJ Governor Kazuo Ueda said at a press conference that certainty for the outlook is rising gradually, and that he will consider ending negative rates if the price goal comes into view.  

The decision to keep the policy rate and yield-curve-control unchanged on Tuesday chimed with economists’ expectations for the status quo, following a powerful earthquake hitting Japan on New Year’s Day and Ueda’s dovish remarks at the end of December. 

Here’s what analysts and strategists had to say: 

Post-Press Conference

Charu Chanana, market strategist for Saxo Capital Markets Pte

“The change in tone from Ueda is apparent, and keeps the April meeting live. However, Japanese yen will likely struggle to hold on to these gains in the near term given that US yields are likely to remain volatile as the markets start to price in a Trump presidency and US economic data remains robust.”

Naka Matsuzawa, chief strategist at Nomura Securities Co.

“So far Ueda’s presser has been more clearly hawkish than the outlook report itself and gives the impression the BOJ is getting closer to a victory call of achieving 2% inflation target and an end of NIRP. It’s quite natural JGB/FX markets have taken this message seriously and JGB yields/JPY have risen further in the evening session. The market should see the chance of an April rate hike is now clearly higher than 50%. Japanese stocks should correct further while bank stocks should be supported by higher yields.”

Tsutomu Soma, a bond and currency trader at Monex in Tokyo

“Bank of Japan Governor Kazuo Ueda’s remarks appear to suggest it is a step closer to scrapping the negative interest rate in the near future. Still, the central bank probably wants to see the results of wage increases to assess if this is a sustainable trend and therefore, it won’t probably rush to take action.”

Tsuyoshi Ueno, a senior economist at NLI Research Institute in Tokyo

“Expectations are reflected in market moves that there will be a move toward normalization in a not-distant future including an end to the negative-rate policy. As we move into March, expectations of imminent BOJ policy normalization will further grow. I see 10-year yields will edge higher and reach 0.8% levels in March.”

Amir Anvarzadeh, a strategist at Asymmetric Advisors Ltd in Singapore

“Japan’s economy doesn’t really require the kind of aggressive zero rate policy that BOJ has stuck to and with shunto wage negotiations looking fairly healthy the direction is still clear that BOJ needs to become less accommodative while the Fed will need to pivot the opposite direction. 

Whether BOJ moves in March or April or the Fed pivots — rates are going the opposite direction in Japan and US. That means that the dollar/yen will likely fall back to 140 and even lower as we get to summer.”

Alan Lau, a strategist at Malayan Banking Bhd in Singapore

“Ueda’s tone this time does tend to sound more hawkish and hints towards an exit from NIRP soon, possibly in April. However, the Fed’s policy continues to be a major determinant beyond just the BOJ. If anything, an NIRP exit does not necessarily change the game too much as UST-JGB yield differentials remain wide and the BOJ could be slow in undertaking any further adjustment beyond this action.”

Pre-Press Conference 

Alvin Tan, head of Asia FX strategy at RBC Capital Markets in Singapore

“There is a 90% probability that the BOJ will lift rates in April, with a 10% chance that it will come in the June decision. Gradual policy normalization remains on course, but the BOJ can stay patient as the spring wage round unfolds. We are looking at a near-term USD/JPY target of 150.”

Shoki Omori, strategist, Mizuho Securities Co. 

“Shorter tenor yields are likely to fall as market speculation about near-term monetary policy tweak is further receding. The yen will probably keep its weak tone staying at around the current level, but if Governor Ueda sounds dovish about the economy at a press conference later in the day, it would weaken to touch 150 against the dollar in the near term.”

Tony Sycamore, a market analyst at IG in Sydney

“April is when we expect the BOJ to take its next step towards policy normalization and away from NIRP. However as BOJ Governor Ueda has already flagged any policy changes will be ‘carefully assessed’ we expect upcoming changes to be delicately managed.”

--With assistance from David Finnerty, Yumi Teso, Ayai Tomisawa, Aya Wagatsuma, Masaki Kondo and Matthew Burgess.

(Adds press conference details in paragraph two, and updates with post-press conference voices.)

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