The Bank of Japan appears poised to raise interest rates at its December 18-19 meeting, according to a new Reuters poll showing a slim majority of economists expecting the policy rate to rise to 0.75% from 0.50%. While forecasts remain finely balanced, 53% of respondents (43 of 81) see a December move, and all economists who offered a view said rates would reach at least 0.75% by the end of Q1 2026.
Economists said the yen’s renewed weakness — hitting a 10-month low against the dollar and a record low versus the euro — has strengthened the case for tightening by raising the risk of imported inflation. The BOJ last hiked rates by 25bp in January.
The poll also suggests wage momentum will remain solid, though slightly softer than this year. Economists expect next year’s labour-talk wage gains to average 4.9%, down from 5.25% this year, but supported by robust corporate earnings
