BOJ’s Azada: Further Rate Hikes Could Have Bigger Economic Impact

The signal here is less about the level of rates than about the changing sensitivity of the economy to each additional move. A BOJ board member framing the policy rate as already inside the neutral range implies the easy, low-cost phase of normalization is over, and that the marginal hike now carries more weight than earlier ones. That matters most for yen-sensitive and rate-sensitive exposures, including crypto and other risk assets that have leaned on cheap Japanese funding. Whether the board's caution translates into a slower actual pace, rather than just softer rhetoric, is the open question worth tracking.