The Bank of Japan will hold a policy board meeting on Friday amid growing speculation over whether it will surprise markets with additional credit easing, just as it did a year ago.
The central bank is expected to trim its growth and inflation forecasts in a biannual economic and price outlook report to be adopted at the meeting.
With the European Central Bank signaling a willingness to ease its monetary policy in December and China cutting its key interest rate, there are growing expectations the BOJ will follow suit with additional relaxation. Yet a number of BOJ officials remain cautious on the matter.
In the report, the BOJ is expected to lower its inflation and growth forecasts made in July due to slowdowns in emerging market economies and continuing lower oil prices.