BOJ Likely To Raise Rates To 1.25% At Friday Meeting, CNBC Survey Shows

According to CNBC, the Bank of Japan is likely to raise rates to 1.25% at the end of its two-day meeting on Friday, with 89% of respondents in a CNBC survey expecting a 25-basis-point increase amid higher inflation, stronger wages and pressure from the U.S. government. The survey, conducted Sept. 9-14 among 18 economists and analysts, found that the BOJ last raised rates in June and that a hike would mark a faster pace of tightening than the six-month interval it has followed since policy normalization began in March 2024. Japan's headline inflation rate for July reached 1.9%, its highest this year, while real wages rose 2.4% for a seventh straight month. Treasury Secretary Scott Bessent told BOJ Governor Kazuo Ueda to take decisive market and monetary steps at the G20 finance ministers and central bank governors meeting earlier this month, and later said they discussed anchoring inflation expectations and avoiding excess volatility in exchange rates. Takahide Kiuchi, executive economist at Nomura Research Institute and a former BOJ policy board member, said the Trump administration has effectively removed any obstacle to a rate increase by a Takaichi administration, giving the BOJ room to keep hiking. Jesper Koll of Monex Group said he expects a 50-basis-point increase in a one-time move, while Carlos Casanova of UBP said he expects the BOJ to hold for now but eventually deliver two 25-basis-point hikes every six months. Around a third of respondents named Toichiro Asada and Ayano Sato as the board members most likely to dissent on a hike, and 61% said they expect the yen to trade between 155 and 160 over the next month.