Bank of Japan Expected to Hold Rates at 0.5% Amid Trade Uncertainty

The BOJ is balancing domestic wage growth and inflation stability with risks from U.S. tariffs as it evaluates future policy changes.

The Bank of Japan is forecasted to maintain its 0.5% interest rate at the conclusion of its March 19 policy meeting, following its January hike to the highest level in 17 years.
Economic uncertainty driven by U.S. President Donald Trump's tariff policies is influencing the BOJ's cautious approach to further rate hikes.
Japan's wage growth is projected to accelerate to 3.0% in 2025, supporting inflation stability around the BOJ's 2% target, according to Goldman Sachs.
Analysts predict a potential rate hike to 0.75% in July, contingent on continued wage growth and favorable economic conditions.
The BOJ will review updated growth and price forecasts at its April 30-May 1 meeting, which could shape the timing and pace of future rate adjustments.