As expectations for an additional U.S. rate hike rise, market speculation is spreading over the Bank of Japan’s rate-hike path. Domestic investors, however, are skeptical of consecutive rate hikes, and attention is focused first on any move toward foreign-exchange intervention.
As expectations for an additional U.S. rate hike rise, speculation is spreading in the bond market, particularly among overseas investors, that the Bank of Japan may also move to raise rates following its September hike. While higher oil prices and a weaker yen have been identified as common challenges in terms of containing inflation risks, many remain cautious about any specific action.
Most participants in the domestic market remain reluctant to embrace expectations of consecutive rate hikes in both Japan and the United States, and skepticism remains strong regarding the appropriate conduct of domestic policy, despite the influence of external factors.
It has been reported that developments surrounding the policy rate were discussed in the domestic bond market on the 28th, but the article’s continuation is available only to members.