After the Bank of Japan implemented a rate hike, attention shifted away from bank stocks, while real estate stocks were cited as an alternative sector of interest. With strong expectations that the timing of future rate hikes will depend on economic and price conditions, the possibility of a review of the ETF exit strategy was also mentioned.
At its Monetary Policy Meeting held on 15–16 June 2026, the Bank of Japan decided to raise interest rates by 25bp and halt the reduction in its purchases of Japanese government bonds from spring 2027 onward. Both decisions faced opposition, but were within the range of market consensus.
The materials identified 3 factors supporting economic activity, 1 downside factor, and 3 factors that could push prices higher. They stated that the policy of determining the timing and pace of rate hikes based on economic, price and financial conditions remained unchanged. They also indicated that a sharp shift in expectations going forward was unlikely.
Regarding TOPIX performance, the materials showed changes in average levels and volatility around periods when Bank of Japan meetings coincided with FOMC meetings, pointing to cases in which policy events in Japan and the United States affected the market.
The top-down outlook indicated that while interest in bank stocks was declining, real estate stocks were becoming more attractive for investment as their valuation appeal recovered. It also outlined a policy of newly positioning real estate stocks as a sector of interest.
The Bank of Japan's ETF holdings were estimated at slightly more than ¥110 trillion. Although a review of the exit strategy was not currently under consideration, the materials suggested that it could be reviewed in the future.