A Gold Ten Data News on May 27th, institutional analyst Taro said that the ambiguous information from the Bank of Japan on the next interest rate hike issue has led the market to believe that it needs time to take action. Currently, the Bank of Japan is trying to balance two pieces of information in its latest guidance: one is the determination to normalize policies, and the other is the recognition of the risks that may deviate from the track. The latter may be to ease the message it conveys, so as not to panic the market and think that it has turned to a hawkish stance. The Bank of Japan has shifted the trigger point for its next policy from its projected inflation rate to the level of certainty in its price forecast. This means that even if there is no overheating of macro data, the Bank of Japan can raise interest rates once the committee members become more confident about the inflation outlook. This ensures more flexibility. The Bank of Japan also made a statement that raising interest rates does not mean tightening policy. On the contrary, it will "adjust the degree of monetary easing". This lowers the threshold for interest rate hikes, as the Bank of Japan can claim that even with an increase in policy rates, the monetary environment will remain loose. The current basic forecast is that the Bank of Japan will raise the target range for the overnight call rate from the current 0% -0.1% to 0.15% -0.25% in July, and then raise it again to 0.4% -0.5% in October.
