Preview: BoJ on Hold While Bond and FX Stresses Are Rising

In this paper, we discuss:

• The BoJ’s expected decision to keep rates on hold at 0.75%, following December’s historic hike;
• Rising JGB yields and yen weakness, reflecting concerns over fiscal dominance and market stability;
• A gradual normalisation path, with further tightening likely delayed unless FX pressures intensify.

Download PDF: Bank of Japan Preview – January 2026