The Bank of Japan has made an important move. After many years of very low interest rates, BOJ has increased interest rates. This is a big change because Japan kept rates low for decades.
The main reason for this decision is rising inflation. Prices of food, energy, and daily items are going up in Japan. Wages are also slowly increasing, so BOJ believes the economy is strong enough to handle higher rates.
BOJ said it will raise rates slowly, not aggressively. They want to avoid harming economic growth. The central bank will carefully watch inflation, wages, and economic data before making the next move.
Because of this update:
The Japanese Yen became stronger
Global markets felt some pressure
Risk assets like stocks and crypto may face short-term volatility
In the future, BOJ may also reduce its support in markets, including bonds and ETFs, but everything will be done step by step.
Final View:
This BOJ update shows that global monetary policy is changing. Japan is slowly moving away from easy money. This can affect forex, stocks, and crypto markets worldwide.
