Analysis:Why the BOJ will bet small on rate hikes now to avoid a bigger shock later
Japan's central bank, the Bank of Japan (BOJ), is cautious about raising interest rates by a large 50 basis points in September. Their primary concern is avoiding market shock and ensuring that price pressures remain under control. Recent events, such as the Middle East conflict, domestic job market tightness, and weak yen driving up import costs, have fueled inflation concerns.
Analysts suggest the BOJ might opt for a more modest 25-basis-point hike this month and another 25-point increase in December or January. The BOJ aims to maintain a cautious approach to avoid stoking inflation fears and maintain the sentiment of near-zero borrowing costs.
Written by urgent.news from CNA - Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
