The "Green Sign" of Ueda – Bank of Japan Confirms Interest Increase to 2026

[Igor Pereira]

The Japanese novel won a new explosive chapter this morning. The Governor of the Bank of Japan (BoJ), Kazuo Ueda, has just removed the ambiguity from the market.

By Igor Pereira Financial Market Analyst

While many were waiting for caution, Ueda doubled the bet on standardization. The sign is clear: The era of free money in Japan is numbered.

Below is the analysis of the direct impact on Yen pairs (USD/JPY, GBP/JPY) and the tightening schedule.

Ueda went straight to the point, stating that the Central Bank "will continue to increase interest rates" if the economy and prices evolve as expected.

• ExpertFX Reading: That's not a "maybe." It's a warning. With persistent Japanese inflation and wages rising, the "if" condition is already practically satisfied. Ueda is preparing the ground for action.

The consensus of analysts (reuters research) brings a tactical script to operate:

• Short Term (Hold): BoJ should keep the rate unchanged until March. This gives a window of breath to the Carry Trade in the next few weeks.

• The 2026 Trigger: Research confirms that the bank will increase the rate "at least once in 2026".

• The Danger: The market always anticipates. If the discharge is right for 2026, the big funds will start buying Yen (and selling USD/JPY) long before of the official announcement.

Remember our previous analysis of the JGBs, yielding more than the Chinese.

• The Shock of Interest: With BoJ promising to rise and the Fed (USA) in cutting/maintenance cycle, the interest differential (Spread) will shrink. That's fundamentally low for USD / JPY .

• The Risk of the Carry Trade: Any sign of high interest in Tokyo increases funding for global speculators. If Ueda raises interest in an environment of global volatility, we will see a violent settlement in cross-pairs like GBP/JPY and AUD/JPY .

Ueda gave the warning. The market has until March to reposition, but the intelligent flow is already moving.

The roof for USD/JPY is getting more solid. Any respike ("H4 break") towards 152.00/154.00 should be seen as an opportunity for structural sale, aiming at strengthening the Yen over 2026.

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Game Turned: The Exact Date of the Meeting

There is a specific date in March where the probability of high interest jumps to 80% in the options markets (OIS). Our members PremiumSoon they will be positioned in JPY pairs.

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