Don’t fight the BOJ: -ve real rates is the explicit policy.$JPY to 200, and $BTC to a milly. https://t.co/PdZh87ruVI ...

🇯🇵 NOW: Bank of Japan raises interest rates to 0.75%, the highest level in three decades. ...

Core Viewpoint - The Bank of Japan's interest rate hike has led to a depreciation of the Japanese yen and a corresponding increase in Bitcoin's value, reflecting market expectations and the ongoing shift in Japan's monetary policy [1][3]. Group 1: Bank of Japan's Policy Changes - The Bank of Japan raised its short-term policy rate by 25 basis points to 0.75%, marking the highest level in approximately three decades [1]. - The BOJ acknowledged that inflation has remained above its 2% target due to rising import costs and stronger domestic price dynamics, yet emphasized that real interest rates remain negative, indicating continued accommodative monetary conditions [2]. Group 2: Market Reactions - Following the rate decision, the Japanese yen fell to 156.03 per U.S. dollar from 155.67, while Bitcoin rose from $86,000 to $87,500 before stabilizing around $87,000 [3]. - The market's reaction was in line with expectations, as the rate hike had been anticipated, and speculators had maintained long positions in the yen, which mitigated any sharp buying response [3]. Group 3: Carry Trade Dynamics - Japan's historically low interest rates have made the yen a favored funding currency for carry trades, allowing investors to borrow cheaply in yen to invest in higher-yielding assets globally [5]. - Concerns that the rate hike could strengthen the yen and lead to an unwinding of carry trades were deemed exaggerated, as Japanese rates would still be significantly lower than U.S. rates, preventing a mass unwinding of these trades [6].

The yen extended losses against the dollar after the Bank of Japan raised its benchmark interest rate by 25 basis points https://t.co/Ojmr1XryTt ...

Core Viewpoint - The rise in interest rates in Japan is having a significant impact on global markets and may lead to increased borrowing costs in the U.S. [1] Group 1: Impact on Global Markets - Japan's interest rate hikes are causing fluctuations in global financial markets, indicating a potential shift in investor sentiment and capital flows [1] - The changes in Japan's monetary policy are expected to influence other central banks' decisions, particularly in developed economies [1] Group 2: U.S. Borrowing Costs - The increase in rates in Japan could lead to higher borrowing costs in the U.S., as investors reassess risk and return dynamics [1] - U.S. financial institutions may face pressure to adjust their lending rates in response to the changes in Japan's interest rates [1]

The Bank of Japan raised its benchmark interest rate to the highest level since 1995, as broadly expected by market participants https://t.co/wgGHy5ljCP ...

Core Viewpoint - The Bank of Japan has raised its policy rate to 0.75%, the highest level since 1995, as part of its ongoing policy normalization due to persistent inflation above target levels for nearly four years [2][5]. Group 1: Policy Changes - The Bank of Japan increased benchmark rates by 25 basis points to 0.75%, aligning with economists' expectations [2]. - Japan has been normalizing its monetary policy since last year, moving away from a negative interest rate regime that lasted since 2016 [3]. Group 2: Economic Indicators - Inflation has exceeded the BOJ's 2% target for 44 consecutive months, with consumer price growth recorded at 2.9% in November [5]. - Real wages have been declining for 10 months, indicating pressure from high inflation [5]. Group 3: Future Outlook - The BOJ anticipates that firms will likely continue to raise wages steadily next year, following solid wage increases in 2025 [4]. - The bank noted that underlying inflation is rising moderately, with firms passing on wage increases to selling prices [4]. Group 4: Economic Risks - The recent rate hike poses risks to the Japanese economy, which has shown signs of contraction, with GDP shrinking by 0.6% quarter on quarter and 2.3% on an annualized basis [6]. - Rising government bond yields are increasing borrowing costs for Japan, contributing to fiscal strain [6].

Japan’s key inflation gauge stayed at 3% for a second month, signaling sustained price pressure hours before the Bank of Japan is widely expected to boost borrowing costs for the first time since January https://t.co/DdJRsM7dw1 ...

Group 1: Inflation and Economic Indicators - Japan's consumer inflation rate decreased to 2.9% in November, remaining above the 2% target for the 44th consecutive month, which strengthens the prospects of a rate hike by the Bank of Japan (BOJ) [1] - Core inflation remained unchanged at 3% in October, aligning with economists' estimates, while the "core-core" inflation rate fell to 3% from 3.1% [2] - Rice inflation slowed to 37.1%, marking the sixth consecutive month of decline, after experiencing over 50 years' highest price growth earlier this year [3] Group 2: Bank of Japan's Policy and Economic Growth - The BOJ is expected to raise interest rates to their highest level since 1995, as it concludes its policy meeting, despite concerns about the weak Japanese economy, which contracted 0.6% quarter on quarter and 2.3% on an annualized basis in the third quarter [2][4] - Prime Minister Sanae Takaichi emphasized the need for proactive spending to boost growth and tax revenues, advocating for looser monetary policy and criticizing BOJ's rate hikes [4] - BOJ Deputy Governor Masazumi Wakatabe stated that raising Japan's neutral interest rate is essential for balancing economic growth and inflation, while cautioning against premature rate hikes [5][6] Group 3: Currency Impact - Following the inflation data release, the yen strengthened slightly, trading at 155.53 [7]

for the potential market impact here at home. Let's bring in market forecaster Jim Biano Bianca Research. Jim, great to have you with us.There's a lot to discuss, but in terms of the CPI print, this has not in your mind put to bed the concerns about inflation going higher. >> Yeah, this number was a statistical mess. They assumed that rents in the United States were effectively zero for the month of October.They surveyed the second half of the month because the government was shut down. So when you see thin ...