Bank of America: Bank of Japan's Rate Hike Pace May Be More Gradual Than Inflation Outlook Requires

Jin10 Data, June 10 – Bank of America Securities stated in a research report that the Bank of Japan's pace of advancing its interest rate policy might be more gradual than what the inflation outlook necessitates. Bank of America expects the Bank of Japan to raise rates by 25 basis points this October, followed by additional hikes in March and July 2027, ultimately raising the terminal rate to 1.75% by the end of 2027. The risk of this gradual approach lies in the possibility of the central bank falling behind the inflation curve. If upward price pressures are stronger than anticipated, the Bank of Japan may be forced to hike rates at a faster pace or push the terminal rate to a higher level to bring inflation back to its target.