According to a Reuters poll published on Wednesday, a majority of economic analysts expect Japan's central bank to raise interest rates again by the end of the year.
This follows the actions of the Bank of Japan (BOJ) at the latest meeting at the end of July, which raised interest rates to 0.25% and also announced plans to reduce the purchase of government bonds.
Also giving a surprise to investors when the market is expecting the interest rate to be maintained at the 0.10% level as before.
The method of increasing rates and tapering is done by the central bank during the phase of tightening monetary policy.
Therefore, investors can see the effect of the strengthening of the Yen currency that has been displayed before.
The approach taken by the BOJ is seen as clearly contrary to the policy of other central banks, especially the Federal Reserve (Fed) which is now preparing to move to easing monetary policy.
According to the Chief Economist at the Itochu Research Institute, the current policy for the BOJ is currently very accommodative, hence interest rate hikes are likely to continue to neutral levels with the price stability target achieved.
Japan's economy has grown rapidly to an annual rate of 3.1% for the second quarter of 2024, recovering from the record at the beginning of the year, supported by a strong consumer sector.
