Source: Insider According to sources: Bank of Japan considers rate hike in June, could raise rates again in 2026

June 4 — Sources with direct knowledge of the matter tell us that Bank of Japan officials plan to debate a 25 basis point increase to the central bank’s benchmark interest rate this month, while also weighing the possibility of further rate hikes later this year. The sources add that at the policy meeting wrapping up on June 16, the Bank of Japan (BOJ) is highly likely to deliberate lifting its policy rate to 1%. BOJ officials hold that the current real interest rate remains too low, and inflation risks continue to climb, leaving room for additional rate increases. Amid high uncertainty over the Middle East situation, central bank policymakers will keep analyzing all data and information right up until the final moments before locking in a decision. The sources note there may be some dissent over the rate hike during the meeting, but such opposition will not be enough to derail the plan to raise rates. Another key agenda for the meeting is the BOJ’s latest plan to scale back its bond purchases. Sources reveal officials are leaning toward slowing the current pace of bond reductions starting next April.