The Bank of Japan is likely to keep raising its benchmark rate to a level exceeding the current market consensus, and there’s a chance two more moves could come this year on top of last month’s hike, according to a former executive director at the central bank.
"My base view is that there is a lot more coming,” Hideo Hayakawa, the former director, said in an interview Tuesday. "There is little logical reason to believe that rate hikes will stop early.”
Based on his own assessment, Hayakawa said he sees the BOJ’s terminal rate in this cycle somewhere around 1.5%. That’s higher than most analysts’ view, although it’s in line with a projection issued by the International Monetary Fund.
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