BOJ to Hike Rates Amid US Pressure

The Bank of Japan (BOJ) is expected to raise interest rates to 1.25% on September 18, according to a Reuters poll.

This move would be sooner than previously anticipated, with some analysts predicting the rate will reach 1.75% by the second quarter of 2027.

The BOJ's decision is seen as a response to concerns over broadening price pressures and yen weakness, which has been exacerbated by a joint U.S.-Japan intervention to stem the currency's slide to 40-year lows.

Treasury Secretary Scott Bessent has expressed strong support for 'decisive' monetary steps to combat yen weakness, which some analysts see as an attempt to sway Japanese policy.

Almost three-quarters of economists polled believe Japan's large budget requests heighten market concerns about the country's fiscal discipline.