Bank of Japan Poised to Hike Overnight Rate to 0.75% as Yen Stabilizes on Hawkish Signals From Governor Kuroda

Market observers say the Bank of Japan is poised to raise the overnight rate by 25 basis points to 0.75% at the policy meeting due to conclude this Friday, marking the first tightening since January and the highest level since 1995.

Under Haruhiko Kuroda, the policy board is expected to back the move, with prior sessions signaling support. Strength in wage growth and a milder-than-expected impact from U.S. tariffs reinforce confidence in an incremental path.

Investors now scrutinize the BoJ’s guidance on the rate path. Even at 0.75%, some insiders say the neutral rate remains out of reach, while others see room beyond 1%. A hawkish tilt could lift the yen and push up bond yields, affecting the budget outlook. OIS pricing implies roughly 95% odds of a hike. The policy statement lands at noon local time, with Kuroda briefing the press at 15:30.