Market News: Bank of Japan Reportedly Leaning Towards 25 Basis Point Rate Hike

BlockBeats News, September 3rd - According to sources familiar with the matter, the Bank of Japan is inclined to raise the benchmark interest rate by 25 basis points this month to address the upward risk of inflation. It will also flexibly adjust the pace of rate hikes based on the economic and price situation in the future.

The sources stated that Bank of Japan officials will discuss the possibility of raising the policy rate and continue to see inflation risks skewed to the upside. The rise in service prices and the ongoing weakness of the yen have further strengthened the reasons for taking action. Currently, the overall development of the Japanese economy is broadly in line with the Bank of Japan's earlier expectations. As there has been no significant change in the economic situation necessitating a major policy adjustment, the likelihood of a 50 basis point rate hike is low. A source familiar with the matter said this has reduced the market's expectations of a "substantial rate hike." (FXStreet)