Brokerages expect next BOJ rate hike in Dec, further tightening in 2027

By Reuters News

Oct 16 (Reuters) - The Bank of Japan raised interest rates to a 31-year high in September and signalled that further tightening could follow as it shifts its focus to preventing inflation from overshooting its target.
Several brokerages expect the BOJ's next interest rate hike to come in December. The policy rate currently stands at 1.25% and the central bank's next policy decision is due on October 30.

Here are the policy forecasts from major brokerages:

Brokerage

Policy forecast

J.P.Morgan

4 rate hikes, in December 2026, April, July and December 2027

HSBC

1 rate hike in Q1 2027

BofA Global Research

3 rate hikes, in December 2026, March and July 2027

Goldman Sachs

2 rate hikes in January and July 2027

Morgan Stanley

2 rate hikes in December 2026

and March 2027

Citigroup

3 rate hikes, in December 2026, March and July 2027

Nomura

2 rate hikes in December 2026 and March 2027

Standard Chartered

2 rate hikes in Q1 2027

Deutsche Bank

2 rate hikes, in January and April 2027

UBS Global Wealth Management

2 rate hikes, in January and June 2027

Macquarie

2 rate hikes, in December 2026 and Q2 2027

TD Securities

4 rate hikes, roughly once every quarter, in December 2026, April, July and October 2027

** All rate increases referenced in the forecasts are 25 basis points (bps) each

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