Makoto Sakurai, a former board member of the Bank of Japan, says the central bank could hike rates twice more by March 2027, pushing the policy rate to roughly 2% by the end of Governor Kazuo Ueda’s term in early 2028. For anyone holding risk assets, and especially crypto, that trajectory matters a lot.
The BOJ just raised its short-term interest rate by 25 basis points to 1% on June 16, the highest level since 1995. That alone is remarkable for a central bank that maintained negative interest rates for 17 years before finally abandoning them in March 2024.
Japan’s slow-motion policy reversal is speeding up
The June rate hike was the first increase since December 2025, and internal discussions at the BOJ suggest some board members are pushing for an even faster pace of tightening. A summary from the BOJ’s meeting on June 24 revealed active debate among policymakers about accelerating rate hikes, citing strong underlying inflation pressures and financial conditions that remain accommodative.
Energy costs linked to geopolitical tensions in the Middle East are adding fuel to the fire, making it harder for policymakers to justify patience.
