Economists predict the Bank of Japan will raise rates to 1.25% by December, with further increases expected through 2027.
A Reuters poll reveals 86% of economists expect the Bank of Japan to raise its key interest rate to 1.25% by the end of Q4, up from 79% in June. The move could come as soon as October, with further hikes anticipated next year.
70% of respondents foresee rates reaching at least 1.50% in Q2 2027, while 51% view 1.50% as the terminal rate. Concerns over rising Japanese Government Bond yields and debt-financing costs were noted by 58% of economists.
The USD/JPY pair, currently at 163.07, is down 0.05% on the day, with 79% of economists deeming the yen too weak at around 160 relative to fundamentals.