BOJ Hike Triggers Orderly Bitcoin Reaction Despite Yen Weakness

The Bank of Japan (BOJ) raised its policy-rate target to 1.25% on September 18, but Bitcoin's reaction was surprisingly orderly.

The BOJ voted 7-2 to increase the uncollateralized overnight call rate by 25 basis points from about 1% to 1.25%, with the new rates taking effect on September 24.

The yen weakened after the decision, but the traditional carry-trade unwind pattern was not seen, as the dollar climbed to a two-week high against the yen during BOJ Governor Kazuo Ueda's press conference.

A sharp yen appreciation alongside falling risk assets would be a stronger warning of unwind pressure, but for now, the limited immediate pressure suggests that investors can adjust their positions before implementation.