The Bank of Japan is expected to raise interest rates at its fastest pace, while the US Fed has decided to raise rates. Markets are reacting to the weaker yen and volatility in equities.
The Bank of Japan is holding a monetary policy meeting over 2 days through the 18th to decide financial policy that will affect people's lives going forward, and is expected to approve an increase in its policy rate. Following the rate hike in June, the latest increase could also come at an "unprecedented" pace. The persistent risk of rising prices has been cited as the backdrop. Reports have also described the complex situation surrounding increases in the prices of milk and eggs. Following the Fed's decision, expectations of further rate hikes have also emerged.
The Fed implemented a 0.25% rate hike, its first increase in 3 years and 2 months. Most meeting participants expect another rate hike during the year, and raising the policy rate to curb inflation remains an ongoing challenge. Chair Warsh pointed to persistently high inflation and suggested a policy of moving quickly to achieve price stability.