At a regular meeting held on the 14th and 15th, the US Federal Open Market Committee (FOMC) decided to raise the main policy interest rate by 75 basis points (bp, 1bp = 0.01%). This is the largest rate hike since 1994. Federal Reserve Chair Powell has suggested that the July meeting will also raise rates significantly. He has made it clear that he will take strong steps to curb the unexpectedly high inflation.
Chair Powell explained that there is a high possibility that an additional rate hike of 75bp to 50bp will be decided at the next meeting. FOMC participants expect the policy rate to rise to 3.4% by December and 3.8% by the end of 2023.
The big flow of the USD is still up, but today the profit-taking sale and the Swiss franc have cleared the interest rate hike, so we are aware of the possibility of a rate hike even in the Japanese yen, and the USD is no longer self-reliant.
In that respect, it is assumed that even if the USD rises in the future, the currencies that raise interest rates will increase, so it will be dispersed because it is becoming easier to flow to other currencies.
In that respect, the BOJ’s policy interest rate tomorrow needs attention. If only the Bank of Japan says “easy, no rate hike”, sales will be concentrated.