An estimate indicates that the Bank of Japan’s 0.25-percentage-point policy rate hike will increase loan repayment burdens for younger people, while older people will benefit from higher interest income on their financial assets.
The Bank of Japan raised its policy rate from 1.0% to 1.25% at its monetary policy meeting on 18 September, marking the sixth hike since the rate increases began in March 2024. The move came just 3 months after the previous hike in June, amid global efforts to curb inflation and the impact of yen depreciation. An estimate by Mizuho Research Institute projects that fixed-term deposit rates will rise by 0.15 percentage points to 2.13% and mortgage rates by 0.25 percentage points to 1.45%, resulting in a ¥400 billion overall benefit for households.
By age group, younger households with 2 or more members tend to carry larger loan balances. Annual repayment burdens are expected to increase by ¥22,000 for those aged 29 and under and by ¥23,000 for people in their 30s. By contrast, people aged 60–69 are expected to receive ¥20,000 more a year in interest on their savings, while those aged 70 and over are expected to see an annual benefit of ¥21,000.