The Bank of Japan has raised rates to 1.25%, the highest since 1995. Itโs also the sixth hike since Japan ended its negative interest rate policy in March 2024. So why did the yen fall?
โ The hike was already priced in. The decision met expectations. Without an extra surprise, there may be little reason for fresh buying.
โก The outlook for further hikes fell short of some investorsโ expectations. The vote was split, leaving the market concerned that the BOJ would remain cautious about raising rates further.
โข The US is raising rates too. Higher rates in Japan donโt necessarily mean the gap with US rates will narrow quickly. Dollar assets still offer attractive interest returns.
Itโs like a company reporting higher profits, only for its share price to fall. If the market was expecting more, even good news can trigger a sell-off.
https://t.co/kgY8IXlbzl, which I recommended earlier, continues to rise on higher volume. Congrats to everyone who profited from the move!
๐ฏFollow me and learn a little about finance every day
$0100.HK