Société Générale: The Bank of Japan's interest rate hike pace may be slightly faster than previously expected

Economists at BNP Paribas have stated that, given Prime Minister Fumio Kishida's expansionary fiscal policy may further boost inflation, the Bank of Japan is expected to raise interest rates at a slightly faster pace than previously anticipated.

Analysts expect the Bank of Japan to raise rates in April, followed by continued tightening every four to five months until the policy rate reaches 2%. The report noted, "Depending on future exchange rate trends, the possibility of the next rate hike being brought forward to March cannot be ruled out." Japanese officials have previously warned that the government is prepared to take measures against excessive fluctuations of the yen.