The Bank of Japan raised interest rates by 25 basis points, and BTC/JPY rose in response

According to Woofun AI, the Bank of Japan (BOJ) implemented a second rate hike to raise the benchmark interest rate by 25 basis points to cope with stubborn inflation and the long-term weak trend of the yen.

Bitcoin's exchange rate (BTC/JPY) rose 0.5% to 1.06 million yen, according to data from the Tokyo bitFlyer exchange. According to data compiled by Woofun AI, Bitcoin remained around $76,900 in dollar terms, while USD/JPY rose from 156.20 to 156.70, and yen depreciated against the US dollar. Earlier, US Treasury Secretary Scott Bessent called for concerted intervention to buy yen in order to maintain the stability of the US fiscal market.

Over the past decade, interest rates close to zero have prompted traders to borrow yen funds to invest in other high-yield projects, forming a wide range of arbitrage transactions. Observers are concerned that a reversal of such transactions could drag down the market, and a brief sharp decline in the stock market and Bitcoin in early August 2024 reflected this risk. As a result, BOJ's interest rate decisions and yen movements have had a profound impact on global markets.

The Federal Reserve raised the benchmark interest rate by 25 basis points earlier this week, setting the target range of 3.75%-4.00%, the agency's first rate hike since 2023. Investment banks such as Goldman Sachs (GS.US) and Morgan Stanley (MS.US) expect the Federal Reserve to raise interest rates again in October, tightening the trend of global liquidity or further increasing market fluctuations.