Ueda signals more BOJ rate hikes as 10-year yield hits highest since 1999

Beincrypto reports that Bank of Japan Governor Kazuo Ueda used his first public appearance of 2026 at a New Year bankers conference to say the central bank will “keep raising rates in line with improvement in the economy and inflation,” signalling that the BOJ’s rate‑hiking cycle is far from over.

The comments followed the BOJ’s Dec. 19 move to lift its benchmark rate to 0.75%, the highest since 1995, and came as Japan’s 10‑year bond yield reached its highest level since 1999 while the yen traded near 157 per dollar. Markets and analysts note that rising Japanese rates have historically unwound yen carry trades, and Bitcoin has fallen 20–31% after each of the past three BOJ rate hikes; the August 2024 flash crash — when the Nikkei plunged 12% in a day and Bitcoin tumbled — is cited as an example of rapid unwind risk.

The BOJ said Japan’s real policy rate remains deeply negative (around −2.15% with inflation at 2.9%) and that there is “considerable distance to the neutral interest rate level,” implying 100–175 basis points of possible further hikes. Financial strains are already visible: Norinchukin Bank reported $12.6 billion in losses and sold $63 billion in foreign bonds, while regional banks hold about ¥3.3 trillion in unrealized losses (up 260% since March 2024).

Key Topics

Business, Kazuo Ueda, Yen, Bitcoin, Norinchukin Bank