The Bank of Japan's hawkish surprise! Next rate hike may be moved up to April, crypto market faces liquidity test
The yen short sellers are panicking! Just after the Bank of Japan raised interest rates to a 30-year high, it signaled an unexpectedly hawkish stance. The next rate hike could come sooner than the market expects, and global capital flows may change? Last Friday, after the Bank of Japan announced the rate hike, Governor Ueda Kazuo clearly stated that "further rate hikes will continue," with the neutral interest rate range still having a significant gap at the lower end of 1.0%-2.5%. Even more explosive, institutions like JPMorgan are predicting an aggressive rate hike in April next year, and the ongoing yen depreciation is becoming an accelerator for rate hikes—Finance Minister has issued the strictest intervention warnings, and internal central bank concerns about depreciation pushing up import inflation are rising. Multiple hawkish signals are emerging: upward revisions of overseas economic expectations, corporate wage increases becoming certain, and real interest rates remaining extremely low—all suggest that the rate hike cycle is far from over. As a globally low-cost financing currency, the yen's rate hikes directly impact arbitrage trading, and the crypto market has always been most sensitive to such liquidity changes. Historical data shows that rising yen financing costs have triggered short-term Bitcoin corrections, but this time, combined with misaligned Federal Reserve policies, the market is showing an opposite reaction of "all negative news exhausted." Hayes even stated outright: "Under negative real interest rates, yen depreciation will promote Bitcoin adoption." The January quarterly report and the two key rate hike windows in April and July could each stir the crypto market. Do you think the Bank of Japan will raise rates as scheduled in April? Can Bitcoin withstand liquidity contraction pressures and move towards the $100,000 target?
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The Bank of Japan's hawkish surprise! Next rate hike may be moved up to April, crypto market faces liquidity test
The yen short sellers are panicking! Just after the Bank of Japan raised interest rates to a 30-year high, it signaled an unexpectedly hawkish stance. The next rate hike could come sooner than the market expects, and global capital flows may change?
Last Friday, after the Bank of Japan announced the rate hike, Governor Ueda Kazuo clearly stated that "further rate hikes will continue," with the neutral interest rate range still having a significant gap at the lower end of 1.0%-2.5%. Even more explosive, institutions like JPMorgan are predicting an aggressive rate hike in April next year, and the ongoing yen depreciation is becoming an accelerator for rate hikes—Finance Minister has issued the strictest intervention warnings, and internal central bank concerns about depreciation pushing up import inflation are rising.
Multiple hawkish signals are emerging: upward revisions of overseas economic expectations, corporate wage increases becoming certain, and real interest rates remaining extremely low—all suggest that the rate hike cycle is far from over. As a globally low-cost financing currency, the yen's rate hikes directly impact arbitrage trading, and the crypto market has always been most sensitive to such liquidity changes. Historical data shows that rising yen financing costs have triggered short-term Bitcoin corrections, but this time, combined with misaligned Federal Reserve policies, the market is showing an opposite reaction of "all negative news exhausted."
Hayes even stated outright: "Under negative real interest rates, yen depreciation will promote Bitcoin adoption." The January quarterly report and the two key rate hike windows in April and July could each stir the crypto market.
Do you think the Bank of Japan will raise rates as scheduled in April? Can Bitcoin withstand liquidity contraction pressures and move towards the $100,000 target?