Bessent's Comments Fuel Expectations of BOJ Rate Hike in September

Tokyo - US Treasury Secretary Scott Bessent's recent comments have strengthened expectations that the Bank of Japan (BOJ) will raise interest rates in September 2026. Bessent argued that a rate increase is necessary to ease market concerns over inflation.

The BOJ has left the door open for further rate increases, and its decision to keep rates unchanged last week was accompanied by a warning about rising inflation risks. Market attention now focuses on a planned meeting between Bessent and BOJ Governor Kazuo Ueda in late August, ahead of the BOJ's policy meeting on 17-18 September.

Kazuo Momma, a former BOJ official, said the joint intervention with the US had given the BOJ room to raise interest rates. He noted that if the Japanese government were to prevent the BOJ from raising rates, it could be seen as a betrayal of the United States.