Why the Bank of Japan may overshadow the Federal Reserve on Super Wednesday

In Super Wednesday's central bank double-header, the Federal Reserve's show may be an afterthought to the Bank of Japan's performance.

In a case of unusual timing, both the BOJ and the Fed will announce the outcomes of their monetary policy meetings on Wednesday. While the two major central banks frequently meet in the same week, a same-day announcement was unusual.

The BOJ statement is due around midday Japan time Wednesday and the Fed's statement is scheduled for later in the global day, around 2 p.m. Eastern time.

But while the Fed would usually be more closely watched by global markets, this time around, the BOJ will have financial players hanging on the edge of their seats. That's because analysts broadly expect the Fed to stand pat on policy while turning more hawkish in its statement, while the BOJ, which has promised a comprehensive assessment of its current quantitative easing and negative interest rate policies, can only surprise the wide-ranging predictions for its next moves.

"The greater uncertainty is on the BOJ and what they say. My sense is that there is a great deal of ambiguity on how the BOJ should proceed. Theirs is a much bigger meeting for markets than the Fed meeting, just because the Fed is not expected to surprise," Thomas Lam, chief G-3 economist at RHB Securities in Singapore, told CNBC on Monday.

Analyst predictions for the BOJ's next move varied widely, from expectations that the central bank would cut interest rates deeper into negative territory, to changing the size or make up of its quantitative easing asset purchases, to trying to steepen the yield curve or to doing nothing at all.

"The BOJ has a propensity to surprise, although most of the time, the surprises are negative," Lam said.

The market certainly took a negative view of the BOJ's late January surprise move to introduce a negative interest rate policy, when the central bank cut the rate it pays on certain deposits to negative 0.1 percent.

That counterintuitively sent the yen sharply higher, frustrating policymakers who had hoped a weaker currency would help the BOJ reach its long-delayed 2 percent inflation target by increasing the cost of imports and spurring more consumption.

Indeed, the yen may become the bellwether of how the markets view the twin central bank meetings.

"Dollar-yen has fallen pretty much every time we've had an FOMC and BOJ meeting week this year," David Forrester, a foreign-exchange strategist at Credit Agricole, told CNBC's "Street Signs" on Monday.

He expected that the BOJ would aim to steepen Japan's bond yield curve and if that move "impressed" the Nikkei stock index, then the yen might weaken. Forrester also noted that if the Fed sounded more hawkish in its statement, that would push up the dollar, and by extension, weaken the yen.

Some analysts didn't hold out much hope that the double-feature central bank meetings would affect the currency much.

"Do we think the Fed will be much more hawkish? Unlikely. Do we think the BOJ are going to be able to hit the right buttons to actually say we have a new policy framework that works to get the yen down as much as we did before? Pretty unlikely," Michael Every, head of financial markets research for Asia-Pacific at Rabobank, told CNBC's "Squawk Box" on Monday. "If they both misfire at the same time, then the yen is likely to strengthen."

But not everyone expected huge swings.

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RHB's Lam said that markets were likely to be cautious, and he doubted many players would take big positions amid the uncertainty.

But he added that market reactions could come with a time lag between the BOJ's statement and the Fed's.

"If the BOJ communicates poorly, that's going to raise the caution in markets as you get into the Fed decision," he said.

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—By CNBC.Com's Leslie Shaffer; Follow her on Twitter @LeslieShaffer1