Reuters Survey: Bank of Japan may raise policy interest rates to 1% by the end of June.

According to a survey by Reuters, most economists predict that the Bank of Japan may raise its key interest rate to 1% before the end of June. Some economists expect that due to escalating concerns about inflation and a weakening yen, the central bank may take action as soon as April. In a survey conducted from February 10th to 18th, all 76 economists surveyed stated that the Bank of Japan would keep rates unchanged at its March meeting. However, 58% of them expect the policy rate to reach 1% by the end of June, a slight increase from just over a third in January. Among the 44 economists who explicitly stated the month of the next rate hike, 36% chose June, 20% chose April, and 34% chose July. Kento Minami, senior economist at Daiwa Securities Co., said that the Bank of Japan will continue to move forward with further rate hikes at a relatively fast pace, taking into consideration the inflation risk brought about by expansionary fiscal policy and the impact of yen depreciation. Meanwhile, in order to prevent further depreciation of the yen, two-thirds of the 29 respondents said they expect authorities to intervene in the foreign exchange market again. Of these, 40% believe that the 160 level is the most likely to trigger intervention.