ING Economist Predicts June Rate Hike by Bank of Japan

On May 21, ING economist Min Joo Kang stated that stronger-than-expected exports and stable machinery orders are supporting a potential rate hike by the Bank of Japan in June. According to Jin10, these data indicate resilience in Japan's economy despite recent energy supply disruptions. Hawkish comments from Bank of Japan Policy Board member Junko Koeda have also intensified tightening expectations. ING forecasts a 25 basis point rate increase by the Bank of Japan in June, citing robust activity data, persistent inflation pressures, and growing divisions within the policy committee. Additionally, following recent bond market sell-offs, the Bank of Japan is expected to slow its reduction of Japanese government bond purchases, although long-term Japanese yields may still trend higher.