BOJ seen raising rates to 30-year high, may pressure Bitcoin

The Bank of Japan (BOJ) is expected to raise its key interest rate by 25 basis points to 0.75% on Dec. 19, a move that would mark its highest level in approximately 30 years, Coindesk reported, citing Nikkei. The potential hike is fueling concerns about a stronger yen and tighter global liquidity. According to Coindesk, market participants believe a potential unwinding of the yen carry trade, spurred by rising Japanese rates and falling U.S. Federal Reserve rates, could exert downward pressure on BTC. After the BOJ raised rates in July 2024, BTC experienced a sharp decline from around $65,000 to $50,000. However, some analysts suggest the impact could be limited this time, noting that long positions in the yen have already accumulated and that Japanese government bond yields have priced in the expected hike.