đŻđľ Japan Poised for a Historic Shift â BOJ Rate Hike in Focus
Japan may be on the verge of a major monetary turning point. All eyes are on the Bank of Japanâs policy meeting on December 18â19, 2025, where markets are increasingly pricing in the first interest-rate hike since January, ending an 11-month pause.
Consensus expectations point to a 25 bps hike, lifting the policy rate from 0.50% to 0.75%. Surveys now show nearly 90% of economists expect a December move, with projections suggesting rates could reach 1.0% or higher by late 2026 if inflation and wage growth remain firm.
BOJ Governor Kazuo Ueda has signaled that persistent inflation, rising long-term yields, and corporate wage dynamics are key factors shaping the decision. Yen volatility has also become harder to ignore, adding pressure for policy normalization.
Key Details
⢠Decision timing: End of BOJ meeting â Dec 19 (JST)
⢠Expected move: +25 bps to 0.75%
⢠Drivers: Sticky inflation, rising yields, wage momentum, FX stability
This would mark a rare and meaningful policy pivot for Japan after years of ultra-loose monetary conditions. If confirmed, markets should brace for JPY strength, bond market pressure, and equity sector rotation, with ripple effects across global assets.
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