Japan Central Bank Interest Rate Increase:
Yen Carry Trade Effect: Raising the interest rate from 0.5% to 0.75% (December 19, 2025) for #BOJ negatively impacts yen carry trade strategies. Investors were borrowing yen at low interest rates to buy risky assets (such as crypto). The interest rate hike increases the cost of this strategy and may reduce demand for volatile assets like crypto.
Japan's interest rate increase may tighten global liquidity. This could create selling pressure on risky assets. For example, it was observed that Bitcoin fell below $86,000 after the BOJ's interest rate hike.#BITCOIN
After the BOJ's interest rate increase, both declines and increases were observed in Bitcoin. For instance, while some sources indicated that Bitcoin rose after the interest rate decision, others reported a decline. This shows that the market's reaction to the decision is complex.
