Even after raising rates at this month's meeting, the Bank of Japan is expected to hold 2 more monetary policy meetings this year, fueling market expectations that it will accelerate the pace of rate hikes. With U.S. demands helping to leave the central bank with little room to resist, some market observers expect the pace of rate increases to accelerate.
Even after raising rates at this month's meeting, the Bank of Japan is expected to hold 2 more meetings this year to decide on monetary policy, fueling expectations that it will accelerate the pace of rate hikes.
The market-implied probability of a Bank of Japan rate hike at this month's meeting has risen above 90%, while expectations are building that the probability will be around 20% in October and above 60% in December.
As the pace of rate increases may accelerate, the need for households to review their financial plans is expected to become even more pressing.
Commentary has described the situation as one in which the Bank of Japan has effectively been boxed in by U.S. moves calling for a rate hike.