On December 19, Beijing time, the Bank of Japan concluded a two-day monetary policy meeting and made a historic decision: to raise the policy interest rate from 0.5% to 0.75% by 25 basis points. This interest rate level has reached a 30-year high since September 1995. Although the market had anticipated this, the move is still seen as a landmark event marking the last major central bank in the world to continue bidding farewell to ultra-loose monetary policy, with its ripples quickly spreading from Tokyo to global financial markets, especially in the sensitive cryptocurrency sector.
Core overview of the rate hike decision
Policy interest rate: raised from 0.5% to 0.75%
Interest rate level: highest since September 1995 (30 years)
Nature of the decision: the second rate hike in 2025, in line with general market expectations
Voting situation: unanimously approved by all members of the policy committee
Key basis: moderate economic recovery, continued corporate salary increases, and a stable wage-price positive cycle
The central bank pointed out in its statement that even after this rate hike, real interest rates are expected to remain at 'significantly negative' levels, and the financial environment remains loose. Regarding the future path, the central bank provided a conditional guideline: if the economy and prices develop as expected, it will continue to 'gradually raise interest rates'. This indicates that it is more like a slowly tightening faucet rather than a radical sharp turn.
The continued rate hikes by the Bank of Japan mean that the source of this 'cheap funding' is becoming expensive. Rising interest rates will directly lead to:
Increased borrowing costs: the profit margin for arbitrage trading has been compressed.
Yen exchange rate strengthens: Investors need to repurchase yen to repay yen loans, driving up its exchange rate.
Global liquidity tightening: capital flowing back from global markets to Japan, triggering a sell-off of high-risk assets.
On the global market: gradually raising the global yen financing costs, triggering a reallocation of global capital flows.
On cryptocurrencies: as a typical high-volatility, liquidity-driven risk asset, the cryptocurrency market (especially Bitcoin) is extremely sensitive to changes in global liquidity. The end of cheap yen directly impacts leveraged trading financed by it.
Current market reaction: Since the rate hike has been fully priced in, the market reaction after the announcement was relatively calm, with attention now turned to the guidance on the future path provided at the governor's press conference.#日本加息 #ETH走势分析 $ETH
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