On August 13, Japan’s Prime Minister Sanae Takaichi said she supports the Bank of Japan’s recent interest-rate hikes, and the next move may come in September or October.
The Bank of Japan is issuing a signal that it will raise rates, and Takaichi jumped out to support it too! After many years of observing Japan, they rarely fire blanks. Damn, this is getting interesting—if Japan raises rates in September and October, interest rates could reach around 1–1.5. That would make it even less likely for the Federal Reserve to cut rates. If it were cut to around 3, with such a small interest differential, there’s basically no room for carry arbitrage.
Previously, I “forward looked” that it could reach the 50s. If Japan raises rates—combined with the U.S. rate hikes—and considering the recent China sanctions on the BRA incident, I can’t shake the feeling that we might see it hit the 40s. Maybe even by the end of this year. I haven’t done a detailed time projection yet. Once I finish running the timeline, I’ll be able to forward look to the specific time points.
$BTC
@Yi He @CZ @Richard Teng
The Bank of Japan is issuing a signal that it will raise rates, and Takaichi jumped out to support it too! After many years of observing Japan, they rarely fire blanks. Damn, this is getting interesting—if Japan raises rates in September and October, interest rates could reach around 1–1.5. That would make it even less likely for the Federal Reserve to cut rates. If it were cut to around 3, with such a small interest differential, there’s basically no room for carry arbitrage.
Previously, I “forward looked” that it could reach the 50s. If Japan raises rates—combined with the U.S. rate hikes—and considering the recent China sanctions on the BRA incident, I can’t shake the feeling that we might see it hit the 40s. Maybe even by the end of this year. I haven’t done a detailed time projection yet. Once I finish running the timeline, I’ll be able to forward look to the specific time points.
$BTC
@Yi He @CZ @Richard Teng