Mizuho Sees BOJ Accelerating Rate Hikes Amid Weakening Yen, Rising Inflation

Mizuho Financial Group believes that the Bank of Japan may accelerate its interest rate hikes in response to a weakening yen and rising inflation. According to Zhitong Finance APP, the bank expects the BOJ to raise rates at least once before the end of the year.

Kenya Koshimizu, co-head of Mizuho's Global Markets division, stated that the bank has limited its interest rate risk by holding a portfolio with short durations. The bank holds approximately JPY 20.6 trillion in Japanese government bonds, but most are short-term securities maturing within one year.

Koshimizu noted that the BOJ may shorten the interval between policy actions from six months to three months, which would make it difficult to slow down again. He also expressed optimism about Japan's growth prospects and described Japanese equities as 'highly attractive assets'.