According to PANews, former Bank of Japan board member Makoto Sakurai has stated that the Bank of Japan (BOJ) will not raise interest rates again this year due to the economic turmoil caused by the previous sudden rate hike. In a report on August 12, Sakurai mentioned, 'At least for the remainder of this year, they will not be able to raise rates again.'

At the beginning of August, the BOJ unexpectedly raised its benchmark interest rate to 0.25%, leading to significant sell-offs in the stock and cryptocurrency markets. This rate hike disrupted yen carry trades, where investors borrow yen at low interest rates to purchase foreign assets. The catalyst for the market upheaval was not the rate hike itself but the subsequent surge in the yen in the foreign exchange market. From July 31, the USD/JPY exchange rate dropped from around 153 yen per dollar to 145 yen per dollar. Overnight, the cost of yen-denominated loans increased sharply.

While this rate hike may have disrupted global markets, Sakurai emphasized that it was a necessary change for Japan. For the past 17 years, Japan's interest rates have remained between 0% and -0.1%. Sakurai stated, 'In the process of normalizing monetary policy, they decided to move from near-zero rates to a normal 0.25%, which is a good thing.' He added that it is wise for the central bank to 'wait and see' how further rate hikes will proceed.