The Bank of Japan (BoJ) surprised markets by raising interest rates by 15 basis points to 0.25%, says Alvin Liew, senior economist at UOB Group.
BoJ to keep policy unchanged in September
“The Bank of Japan (BoJ) at its scheduled monetary policy meeting (MPM) on Wednesday (July 31) surprised markets with a 15 basis point interest rate hike to 0.25%, while the announced details for the reduction of monthly Japanese Government Bond (JGB) purchases were in line with market expectations.”
“The MPM statement also included forward policy guidance, which said “if the outlook for economic activity and prices presented in the July Outlook Report is realized, the Bank will continue to raise the policy rate and adjust the degree of monetary accommodation accordingly.”
“We now expect the BoJ to continue on the rate tightening path. We expect the BoJ to keep its policy rates unchanged at the next MPM in September 2024, with the next hike potentially coming in Q4 2024, via a 25 basis point hike to 0.50%, which we believe will be the terminal rate, subject to further changes to the CPI forecasts in subsequent MPMs.”
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
