Updating Our BOJ Forecasts: FX Intervention and Monetary Policy Shifts (Mizuho Securities, August 2026)

Mizuho Securities updated its BOJ outlook to reflect a more hawkish stance, now forecasting three additional rate hikes through mid-2027 starting in September 2026. This shift is driven by inflation concerns and coordinated US-Japan FX interventions.

Key Takeaways

• 1.Mizuho updated its BOJ policy rate outlook, now forecasting a hike to 1.25% in September 2026, followed by 1.50% in January 2027 and 1.75% in June 2027.
• 2.The recent joint US-Japan yen-buying intervention is perceived as a significant factor pushing the BOJ toward a September rate hike.

Table of Contents

• Updating our BOJ forecasts to reflect coordinated FX intervention, 'Summary of Opinions', and recent media reports
• We now expect the next hike to come in September and have also raised our terminal rate forecast to 1.75%
• Updating our JGB and JPY forecasts

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