The move by the Bank of Japan is truly happening. Governor Ueda Kazuo has pushed the interest rate up to 0.75%, a height unseen in Japan for the past thirty years. According to his statements, the risks of economic downturn are diminishing, and inflation has stabilized—behind this narrative, he's actually paving the way for more aggressive policy adjustments.

The key signal is right here: the central bank plans to closely monitor the linkage between wage growth and price trends. Once both move upward together, the probability of further rate hikes becomes incredibly high. Ueda explicitly stated that the true level of the neutral interest rate remains a mystery, and 0.75% is by no means the end. This means the market should be prepared for subsequent policy adjustments.

Interestingly, the yen has actually depreciated in response. What does this strange reaction reveal? Investors may be re-evaluating the sustainability of this rate hike cycle. It’s worth noting that Ueda’s team was using words like "cautious" as recently as May this year, but that language has now disappeared from official statements—this subtle shift in wording often signals a larger policy shift is brewing.

The external environment is also contributing. Temporary stability in global trade has given the BOJ more room to maneuver, but nobody can predict whether tariff shocks will reemerge next year. This is precisely why the central bank emphasizes close cooperation with the government to counter potential US tariffs.

From the perspective of the crypto market, tightening monetary policy means a contraction of global liquidity. As a major source of funds, Japan’s policy shift often triggers changes in capital flows. This rate hike cycle has just begun, and there are many variables to watch for moving forward.