Fighting is likely to increase rates to the highest in 17 years, signal more trips by Reuters

Leika Kihara

TOKIO (Reuters) -It is said that Japan’s bank will increase interest rates at the highest level from the global financial crisis in 2008, as a wide rally of shares around the world is calmed by the creation of politics policy to the whole extent, the tariff threat of US President Trump Trump.

Since merchants are almost fully appreciated in the possibility of increasing the rate, attention is now shifted to any traces of Boj Governor KAZUO Ueda in their meeting after meeting on the pace and the time of further increase.

At a two-day meeting that ended on Friday, battle is expected to increase its short-term policy rate from 0.25% to 0.5% that Japan has not seen in 17 years.

This move would emphasize the determination of the central bank to constantly increase interest rates to about 1% and the level analysts believe that neither cooling nor overheating the Japanese economy.

“The market has not shown a lot of negative reactions to Trump’s comments, so battle will probably continue to increase the rate,” said Naomi Mugurum, the main strategist Bond in Mitsubishi Ufj (NYSE 🙂 Morgan Stanley (Nyse 🙂 Securities.

The hiking battle of the battle would be the first of July last year, when the move, along with weak jobs about the US jobs, shocked the merchants and launched a trip to global markets in early August.

Wanting to avoid repeating, the battle prepared markets with strong Uede signals and his deputy last week that there was a rack on the cards. Notes caused Jen recovered as markets at prices of approximately 90% of the chance to increase the rate.

In a three -month report on the prospects that came after the meeting, it is expected that the Committee will increase its prices on the growing prospects that the wrapping of wages will maintain Japan to hit 2% inflation to sustain.

As the inflation exceeded the goal of battle for almost three years, and the weak jen increased the imports of imports, Ueda is likely to emphasize that the upcoming increase of rates will increase.

The Japanese main consumer inflation has accelerated the fastest annual pace in 16 months in December, the data on Friday has shown, in the sign of growing fuel and food prices continue to encourage life costs for households.

Many analysts are already expecting a central bank to increase rates later this year, banning the market shock caused by Trump that reaches global growth and fragile economic recovery of Japan.

“After hiking to 0.5%, battles are likely to increase rates at about twice a year. As such, the next increase of the rate could happen in September,” said Mari Iwashita, an executive economist in Daiwa Securities.

“It will depend a lot on how the growth and inflation of the United States are played, how it will affect the federal reserves’ policy and moves to the dollar/yen,” she said.

A domestic political calendar can also affect the time of battle with speed from the election for the upper house scheduled for July, when Prime Minister Shiger is a minority coalition to collect votes, some analysts say.

After taking over the helm in April 2023, Ueda dismantled the radical stimulus of its predecessor in March last year and increased short -term interest rates to 0.25% in July.

Fighting policy diameters have repeatedly said that the bank will continue to increase rates, if Japan achieves progress in achieving a cycle in which growing inflation increases salary and increases consumption – thus allows companies to continue to transfer higher costs.