Reserve Dollar

Bank

when

Reserve

The Bank of Japan surprised many today by raising its short-term interest rate to 0.25%. This is the second increase in recent months, as the BOJ attempts to curb the yen’s decline against the US dollar and move towards more normal monetary policies.&nbsp; 
Our financial markets’ response was immediate and massive. The Tokyo stock market felt it first. Initially, stocks dropped by 0.4%, as investors braced for the BOJ’s announcement. 
<figure id="attachment_562352" aria-describedby="caption-attachment-562352" style="width: 100%" class="wp-caption alignnone">
 <img decoding="async" class="wp-image-562352 size-full" src="https://www.cryptopolitan.com/wp-content/uploads/2024/07/Bank-of-Japan-raises-interest-rates-again-Markets-react.jpg" alt="Bank of Japan raises interest rates again - Markets react" width="1920" height="1280" srcset="https://www.cryptopolitan.com/wp-content/uploads/2024/07/Bank-of-Japan-raises-interest-rates-again-Markets-react.jpg 1920w, https://www.cryptopolitan.com/wp-content/uploads/2024/07/Bank-of-Japan-raises-interest-rates-again-Markets-react-300x200.jpg 300w, https://www.cryptopolitan.com/wp-content/uploads/2024/07/Bank-of-Japan-raises-interest-rates-again-Markets-react-1200x800.jpg 1200w, https://www.cryptopolitan.com/wp-content/uploads/2024/07/Bank-of-Japan-raises-interest-rates-again-Markets-react-768x512.jpg 768w, https://www.cryptopolitan.com/wp-content/uploads/2024/07/Bank-of-Japan-raises-interest-rates-again-Markets-react-1536x1024.jpg 1536w" sizes="(max-width: 1920px) 100vw, 1920px">
 <figcaption id="caption-attachment-562352" class="wp-caption-text">
 Credits: The Associated Press
 </figcaption>
</figure> 
But after the rate hike, the market rebounded. The rate hike was seen as a sign that Japan’s economy might be stronger than previously thought. But what would that mean for the dollar, and the global economy? 
<h3 id="b-currency-markets-react-to-japan-s-decision-b">Currency markets react to Japan’s decision</h3> 
The yen made a strong comeback against the US dollar, appreciating by 1.8%. It hit an intraday high of 150.05 yen per dollar, a level not seen since March.&nbsp; 
The BOJ’s decision and hints at future hikes made the yen more attractive to investors. The global currency markets also felt the ripple effects.&nbsp; 
The dollar index, which measures the dollar against other major currencies, dipped by 0.3%. The dollar has gotten pretty weak, partly because of expectations that the Federal Reserve might soon cut rates. 
<figure id="attachment_562353" aria-describedby="caption-attachment-562353" style="width: 100%" class="wp-caption alignnone">
 <img decoding="async" class="wp-image-562353 size-full" src="https://www.cryptopolitan.com/wp-content/uploads/2024/07/Ueda.jpeg" alt="Bank of Japan raises interest rates again - Markets react" width="2000" height="1335" srcset="https://www.cryptopolitan.com/wp-content/uploads/2024/07/Ueda.jpeg 2000w, https://www.cryptopolitan.com/wp-content/uploads/2024/07/Ueda-300x200.jpeg 300w, https://www.cryptopolitan.com/wp-content/uploads/2024/07/Ueda-1200x801.jpeg 1200w, https://www.cryptopolitan.com/wp-content/uploads/2024/07/Ueda-768x513.jpeg 768w, https://www.cryptopolitan.com/wp-content/uploads/2024/07/Ueda-1536x1025.jpeg 1536w" sizes="(max-width: 2000px) 100vw, 2000px">
 <figcaption id="caption-attachment-562353" class="wp-caption-text">
 Kazuo Ueda. Credits: Akio Kon/Bloomberg
 </figcaption>
</figure> 
Investors are now looking at Japan with renewed interest. The BOJ seems to have moved on from its long-standing ultra-loose monetary policy.<a href="https://english.kyodonews.net/news/2024/07/6822440d53e2-update1-bank-of-japan-raises-policy-rate-to-around-025-from-0-01-range.html" rel="nofollow noopener" target="_blank">&nbsp;</a> 
For years, the BOJ kept rates at zero or below to spur economic activity. But when inflation became a pressing concern, the BOJ decided to try a different approach. In a press conference, Chief Kazuo Ueda said: 
<blockquote>
 “The headline inflation rate has been consistently above 2 percent for an extended period. In view of further upside risks to inflation, we thought now was the right time.”
</blockquote> 
Ueda also said that while the BOJ is committed to normalizing its policies, they would proceed cautiously. He acknowledged the challenges from yen’s recent depreciation but added that: 
<blockquote>
 “I don’t think the rate increase will have a serious negative effect on the economy because it’s still at low levels.”
</blockquote> 
More rate hikes could be in the pipeline for Japan, depending on economic data. The central bank announced plans to halve its bond-buying program from the current 6 trillion yen a month by March 2026.

Bank of Japan raises interest rates again – Markets react

Daftar Isi

Cryptopolitan_News

Artikel lain yang dipublikasikan pada 31 Jul 2024

Memereum Presale Surges with Nearly 28 Million Tokens Sold Following SEC Approval of Ethereum ETFs

Sam Altman’s Worldcoin debuts ID verification services in Austria

Hong Kong Set to Launch Asia’s First Bitcoin Futures Inverse Product: What it Means for Traders

Central Bank of Italy Unveils New DLT Protocol for Bitcoin, Enhancing Validator Confidentiality

Why Meme Coins Like PEPE, BONK, And Dogwifhat Fall Short Of Utility Tokens Like ETFSwap

Turn Your Crypto Wallet From Bronze To Gold With These 3000x Tokens Brett & Mpeppe (MPEPE)

Bergabunglah dengan buletin gratis kami untuk pembaruan kripto harian!