Capital Economics: The Bank of Japan may still raise interest rates further

ChainCatcher news, Marcel Thieliant, head of Asia-Pacific at Capital Economics, stated that the Bank of Japan kept interest rates unchanged today, as widely expected by the market, but there is still a possibility of further increasing the policy rate, with a high likelihood of a rate hike at the meeting from April 30 to May 1. The inflation rate is well above the Bank of Japan's target of 2%.

In addition, the wage increases resulting from this spring's wage negotiations are larger than last year's, which should add additional upward pressure on inflation in the coming months. Capital Economics expects the Bank of Japan to raise the policy rate to 1.5% by 2027.