The Bank of Japan raised its policy rate to 1% in June, supported by an easing of domestic downside risks and a neutral stance from the Takaichi administration. Mizuho forecasts a terminal rate of 1.5% with ongoing normalization at a biannual cadence.
Key Takeaways
- 1.The Bank of Japan raised the policy rate by 25bp to 1% in the June 15-16 meeting.
- 2.The hike was facilitated by the Takaichi administration's hands-off policy stance.
- 3.Mizuho forecasts a terminal policy rate of 1.5%, with the next rate hikes expected around December 2026 and June 2027.
Table of Contents
- Overview
- Key points
- Our main scenario is for a terminal rate of 1.5% with the next hike coming in December
- Important Disclosure Information
- Analyst Certification
- Disclaimer
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Authors
Yusuke Matsuo
Securities
Japanese Government Bonds
Themes
Monetary Policy NormalizationBOJ Policy RateJapan-US Interest Rate Differentials
Regions
Asia PacificNorth AmericaJapanUnited States