Fitch expects the BoJ interest rate to 0.75% until 2025

Fitch Ratings said in its latest Bank of Japan (BoJ) policy outlook report that “the BoJ could raise rates to 0.5% by the end of 2024, 0.75% in 2025 and 1% until the end of 2026″.

Supplementary food

The BoJ bucked the global trend of policy easing and raised interest rates more aggressively than we anticipated in July. This reflects his growing belief that reflation is now firmly entrenched.

Core inflation above BoJ target for 23 consecutive months.

Firms prepared to give “ongoing” and “substantial” pay rises.

Quite a different situation from the “lost decade” of the 1990s, when wages did not rise amid persistent deflation.

BoJ’s aim to have a virtuous wage-price cycle.

BoJ confidence that it can continue to raise rates towards neutral settings.

A tighter BoJ could continue to have global ramifications.