Mizuho Financial Group CEO Masahiro Kihara is making a case that the Bank of Japan should stop tiptoeing and deliver a meaningful interest rate increase, arguing it would be a net positive for the Japanese bond market. Mizuho just posted record profits driven largely by prior rate hikes.
The call comes at a pivotal moment for Japanese monetary policy. The BOJ held its policy rate at 0.75% at its late April meeting, but the decision was far from unanimous, with a hawkish 6-3 split vote.
Mizuho’s rate hike roadmap
Kihara isn’t alone in his hawkish posture. Kenya Koshimizu, Mizuho’s markets co-head, has stated that the BOJ could raise rates up to three times in 2026. Kihara himself has suggested that Japan’s terminal policy rate might eventually reach at least 1.5%, with the possibility of a hike arriving as early as this spring.
The BOJ’s April 27-28 meeting didn’t deliver a hike, but the central bank upgraded its inflation forecasts, a move that traders widely interpreted as laying the groundwork for tightening in the months ahead. Markets are now pricing in a possible rate increase by June.
