The Bank of Japan's interest rate hike is imminent: The inverse effect of yen carry trade on cryptocurrency
All fifty economists surveyed by Bloomberg expect the Bank of Japan to raise interest rates from 0.5% to 0.75% next week.
About two-thirds of people expect the BOJ to raise interest rates once every six months, which means that the final interest rate of 1.25% implies that there are still at least two more hikes to come.
What does this mean for cryptocurrency? The inverse yen carry trade will lead to a reduction in global liquidity, affecting risk asset preferences.
Warning from Bitunix analyst: "If the BOJ issues a stronger signal for an interest rate hike, global arbitrage trading will shrink, impacting external dynamics and broader risk preferences." Monitor USD/JPY fluctuations and their impact on cryptocurrency liquidity.
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