BOJ hiked, but stayed dovish → yen weak → USD/JPY up.
BOJ clearly said real interest rates remain significantly negative. That means yen is still cheap to fund.
Even at 0.75%, Japan rates are far below US yields. Carry trade demand stays strong.
BigBreakingWire
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BOJ raised its short-term interest rate target to 0.75%, the highest level since 1995, with the decision approved unanimously. Despite the hike, the BOJ stressed that real interest rates will remain significantly negative.
The central bank said Japan’s economy is recovering moderately, with tight labor markets and strong corporate profits. Wages and inflation are expected to rise gradually, while overall economic growth should remain moderate.
BOJ reaffirmed it will continue raising rates if growth and inflation move in line with forecasts, aiming to sustainably achieve the 2% inflation target. Markets reacted with Nikkei futures up ~0.8%, while USD/JPY pared gains after the decision.
#BoJ #interestrates
The central bank said Japan’s economy is recovering moderately, with tight labor markets and strong corporate profits. Wages and inflation are expected to rise gradually, while overall economic growth should remain moderate.
BOJ reaffirmed it will continue raising rates if growth and inflation move in line with forecasts, aiming to sustainably achieve the 2% inflation target. Markets reacted with Nikkei futures up ~0.8%, while USD/JPY pared gains after the decision.
#BoJ #interestrates
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