Markets bet Bank of Japan will raise rates by 25 basis points on June 15-16

A surprise hike in late July 2024 triggered a global carry-trade unwind that helped send Bitcoin from around $70,000 into the $40,000 range in a sharp macro shock.

Summary

Markets are increasingly positioned for another Bank of Japan rate increase at its June 15-16 monetary policy meeting, with the prevailing expectation pointing to a 25 basis-point move. The focus reflects memories of late July 2024, when an unexpected Bank of Japan hike set off a global carry-trade unwind (closing leveraged bets funded in low-yield currencies). In that earlier shock, Bitcoin fell rapidly from around $70,000 into the $40,000 range, underscoring how shifts in Japanese monetary policy can reverberate across global risk assets. Polymarket is cited as reflecting the current market view.

Terms & Concepts
  • carry-trade unwind: Investors close leveraged positions funded by cheap borrowing.
  • basis point: One-hundredth of a percentage point.
  • Polymarket: Prediction market platform for event-based betting.