Mizuho Securities: The Japanese Central Bank's interest rate hike today has its pros and cons

On July 31st, Kinsey Data reported that Yasunari Ueno, an economist at Mizuho Securities, said that if the Bank of Japan raises interest rates today, it will create an opportunity for the bank to raise rates again later this year. He also said that this would help avoid taking action before the political activities in the autumn and causing dissatisfaction among members of parliament. On the other hand, he added that any recovery in private consumption confirmed in July is ‘obviously premature’. ‘This will give the market the impression that the Bank of Japan will ignore any convincing logic and forcibly change policies in order not to miss any opportunity for policy normalization.’