Bank of Japan's interest rate hike is almost certain, bond investments will be advanced based on relative value - Western AM

October 10, 2024 14:37 JST (excerpt)
Western Asset Management, an active bond management company under the American asset management giant Franklin Templeton, has determined that it is almost certain the Bank of Japan will raise interest rates given the current macro environment. As interest rates rise, the company has indicated a policy to advance bond investments while considering the relative value on the yield curve.
Mr. Hiroyuki Kimura, head of the Japan-based investment management department and portfolio manager, mentioned in an interview on the 9th that conditions for Bank of Japan's interest rate hike are met, citing the rates of wage and price increases, real interest rates being negative and extremely accommodative, and the outlook of a soft landing for the U.S. economy. He expects the next rate hike to be in December or January next year, and sees the policy interest rate being raised at a pace of 'once every six months' until it reaches at least 0.75-1%.