BOJ to Hike Rates Again by December, 90% of Economists Say
A Bloomberg survey shows 90% of economists expect the Bank of Japan to raise interest rates again by December, following a hike to the highest level since 1995.
An overwhelming majority of Bank of Japan watchers anticipate the central bank will raise interest rates again by the end of this year, according to a Bloomberg survey. The survey, conducted after the BOJ's latest hike to the highest level since 1995, found that 90% of economists expect another increase before December.
The BOJ's tightening cycle has been closely watched by global markets, as Japan's rate normalization diverges from the easing or pause cycles of other major central banks. Higher Japanese rates could narrow the interest rate differential with the US and Europe, potentially strengthening the yen and affecting carry trades that have weighed on the currency. For rates traders, the pace of BOJ hikes will be a key driver of yen volatility and Japanese government bond yields. Check NowPrice's rates page for the latest pricing on JPY crosses and JGB futures.
Looking ahead, the timing and magnitude of the next hike will depend on incoming data on wages, inflation, and economic growth. The BOJ has signaled a data-dependent approach, with Governor Ueda emphasizing the need to see sustained inflation above 2%. Markets will focus on upcoming CPI releases and the BOJ's quarterly outlook report for clues on the policy path.