BoJ to Hike Rates to 31-Year High Next Week

With the Bank of Japan expected to lift rates to a 31-year high of 1.25% next week, officials are signaling that geopolitical tensions are reinforcing the need for continued tightening. The market is nearly certain of the 25bp hike, leaving the post-meeting statement as the key indicator for the future path of monetary policy.
According to GN markets/policy (en-US), BOJ board member Masu Kazuaki has warned that the Iran conflict has pushed the world into a "rate-hike mode," though he maintains that a 50bp move is currently unnecessary. This aligns with market pricing, which now reflects a 97% probability of the expected 25bp increase, shifting trader focus entirely to the central bank's communication strategy regarding the terminal rate.
Source: GN markets/policy (en-US)The Bank of Japan is set to raise interest rates by 25 basis points on September 18. This move lifts the benchmark rate to 1.25 percent, a level unseen for three decades.
Source: GN markets/policy (en-US)






