Makoto Sakurai, a former Bank of Japan board member, said on August 12 that the Bank of Japan will not raise interest rates again for at least the rest of this year, but it remains uncertain whether there will be a rate hike before March next year, Wu said.
The Bank of Japan’s sudden hike in its benchmark interest rate to 0.25% in early August disrupted the yen carry trade, sending the yen soaring in foreign exchange markets and triggering a sharp sell-off in stock and crypto markets.
Makoto Sakurai said that although the rate hike could disrupt global markets, it was a much-needed change for Japan, and it was good to move from almost zero interest rates to a normal 0.25%; it would be wise for the central bank to wait and see the effects of further rate hikes.