Original | Odaily Planet Daily (@OdailyChina)
Author | Qin Xiaofeng (@QinXiaofeng 888 )
According to Nikkei News, the Bank of Japan (BoJ) is expected to raise the short-term policy rate from 0.75% to 1.0% at its monetary policy meeting on June 15-16, which would be the highest policy rate level since 1995. Currently, market pricing implies an extremely high probability of a rate hike, with the probability of "a 25bp (basis point) hike" on PolyMarket soaring from 25% in early April to 98%.
With the BOJ's rate hike imminent, a large number of investors engaging in yen carry trades may be forced to sell overseas assets, exchange funds back into yen, and repay loans, triggering a chain reaction that amplifies volatility in global risk assets—the flash crash in August 2024 is a classic case. Back then, a sharp yen appreciation led to a short-term plunge in global stock markets, with Bitcoin plummeting nearly $20,000 in a single day, a maximum drop of 15%.
Odaily Planet Daily will analyze the macro background and transmission mechanism of the BOJ's rate hike, and focus on assessing its risk impact on AI tech stocks and cryptocurrencies, for readers' reference.
1. Inflation Risks Driving BOJ Rate Hike
Over the past two years, hawkish voices within the BOJ have grown stronger, culminating in March 2024 with the end of its 17-year negative interest rate policy, raising the policy rate from -0.1% to a range of 0% ~ 0.1%, marking the first hike in this cycle. In July 2024, the BOJ hiked rates again by 15bp to 0.25% and announced gradual balance sheet reduction; in January and December 2025, it raised rates by 25bp each, bringing the rate to 0.75%; it remained unchanged in the first three meetings of 2026. The following are the details of the BOJ's rate hikes from several meetings:
After keeping rates unchanged for half a year, why is the BOJ迫不及待 starting a new round of rate hikes? This hike is primarily driven by two factors.
First, energy shocks and imported inflation pressure. Fluctuating oil prices due to conflicts in the Middle East in the first half of the year have significantly increased import costs for Japan, a country highly dependent on imported energy. The Corporate Goods Price Index (CGPI) rose 6.3% year-on-year in May, the fastest pace since 2023, with petroleum products up 9.6% and utilities up 8.5%. The BOJ expects core CPI for fiscal year 2026 to rise to 2.5-3.0%, well above the 2% target.
Second, a weak yen exacerbates imported inflation. The current USD/JPY exchange rate continues to hover near the high range of 158-160, approaching historically extreme weakness levels. The significant depreciation of the yen directly undermines the import purchasing power of Japanese companies, leading to a substantial increase in import costs for energy, raw materials, and other commodities, further pushing up domestic price levels. Although Japan's Ministry of Finance has intervened in the foreign exchange market multiple times, the effects have been limited and difficult to sustain. This situation is forcing the BOJ to tighten monetary policy (i.e., raise rates) at its June meeting to avoid inflation expectations spiraling out of control.
In a speech on June 3, BOJ Governor Kazuo Ueda explicitly shifted towards an anti-inflation narrative, emphasizing that if upside risks to prices outweigh downside risks to the economy, the pros and cons of a rate hike must be discussed.
Reuters, citing three informed sources, reported that unless the Middle East conflict escalates sharply, the BOJ will hike rates in June and may slow the pace of bond tapering to maintain market stability. Bloomberg and institutions like ING hold similar judgments, expecting the BOJ to hike a total of 50bp in 2026.
This series of shifts marks Japan's transition from the "global lender of last resort" to a normalizing central bank, posing a direct challenge to global assets reliant on cheap yen financing.
2. Yen Carry Trade Unwinding, Liquidity Continues to Tighten
The Bank of Japan's long-term maintenance of ultra-loose monetary policy has made the yen carry trade a crucial component of global liquidity over the past decade. Investors borrow yen at near-zero interest rates to invest in high-yield assets like US stocks, tech stocks, emerging markets, and cryptocurrencies, earning interest differentials and capital gains.
The BOJ's upcoming rate hike will directly increase yen financing costs and could trigger yen appreciation (USD/JPY decline), forcing leveraged investors to unwind positions, creating a positive feedback loop: yen appreciation leads to expanding forex losses → rising financing costs → forced investor deleveraging → large-scale selling of risk assets → further decline in asset prices → triggering more stop-loss orders → increased unwinding pressure.
Historically, every BOJ policy tightening signal has triggered severe market volatility.
On July 31, 2024, the BOJ hiked rates by 15bp to 0.25% and announced gradual balance sheet reduction, coupled with weak US employment data, triggering severe global market turmoil. At that time, South Korea's two major stock indices (KOSPI and KOSDAQ) both plummeted, triggering circuit breakers; Japanese stocks crashed, with the Nikkei 225 plunging 12.4% in a single day and falling over 20% cumulatively in a week, its worst performance since 1987; global stock markets fell in tandem, with US stocks and tech stocks adjusting simultaneously, and the VIX fear index soaring. Crypto was also hit hard, with Bitcoin and ETH plummeting over 30% within a week, and leveraged liquidations surging.
According to Morgan Stanley estimates, although a significant amount of positions have been gradually unwound since 2024, there are still approximately $500 billion in outstanding yen-financed positions in the market. Although the market has partially priced in some risks ahead of time, these positions still pose a significant隐患. Morgan Stanley warns that if the yen appreciates rapidly, it could trigger chain unwinding during periods of thin liquidity, particularly severely impacting highly leveraged assets.
J.P. Morgan Global Market Strategist Dubravko Lakos-Bujas and Forex Strategist Meera Chandan both noted that the policy divergence between the BOJ and the Fed will exacerbate the instability of carry trade unwinding, potentially leading to a revaluation of global risk assets.
3. Global Risk Assets to Suffer, US Stocks and Crypto Not Spared
The AI-driven tech boom was the main theme of US stocks in the first half of 2026, with chip stocks like Nvidia and Broadcom and hyperscale cloud service providers leading the Nasdaq to repeatedly hit new highs.
However, entering June, significant market rotation and pullbacks emerged, especially on June 5th, when US stocks experienced their most severe single-day pullback of 2026 so far. The Nasdaq plunged 4.18%, marking its largest single-day drop since April 2025; the S&P 500 fell 2.64%, ending a nine-week winning streak; the Dow fell 1.35%, the Philadelphia Semiconductor Index plummeted over 10%, with AI core stocks like Nvidia, Broadcom, Micron, and Marvell leading the decline. (Recommended reading: "Nasdaq's 4.2% Single-Day Drop, Did 'Black Friday' Burst the US Stock Bubble?")
The US stock pullback is due to macro factors like geopolitical tensions and Fed policy uncertainty, but the potential impact from the BOJ's rate hike cannot be ignored.
First, tightening liquidity will directly hit high-valuation growth stocks. AI companies have massive capital expenditure scales and are highly dependent on cheap financing. Unwinding yen carry trades will reduce the inflow of global risk-preference funds, with high-beta tech stocks being the first to be hit. Semiconductor leaders like Nvidia and Broadcom, as well as hyperscalers like Meta and Microsoft, have极高的 valuation sensitivity and are极易 susceptible to selling. Investing.com analysis points out that high-valuation growth sectors are most sensitive to changes in global liquidity; once carry trade unwinding begins, rapid deleveraging often occurs.
Second, rising energy costs will significantly compress AI profit margins. Middle East conflicts pushing up oil prices lead to大幅攀升 in data center power and cooling costs, combining with the BOJ rate hike to create a "stagflationary" macro environment, severely testing the sustainability of the AI business model.
BitMEX founder Arthur Hayes explicitly warned in his latest article "Reality Test": "The energy reality is testing the current market's 'dreaming' state." High oil prices not only raise operational costs but may also slow the growth in corporate token usage, further打击 AI-related revenue expectations.
Finally, there's the supply shock from mega IPOs and political/regulatory risks. Giants like SpaceX, Anthropic, and OpenAI plan密集 IPOs in the second half of 2026, with valuations often in the hundreds of times sales; lock-up period expirations will bring massive supply pressure. Simultaneously, Trump may shift to being anti-AI for the midterm elections, increasing regulatory uncertainty.
Cryptocurrencies, as the highest-beta global risk assets, face an even bleaker outlook. On one side, the BOJ's rate hike increases global financing costs, directly raising the cost of leveraged crypto trades and forcing large-scale unwinding of crypto leveraged positions. On the other side, in competing with AI for liquidity, AI capital expenditure has already absorbed大量 market funds, and crypto is already lagging; BOJ action will further tighten marginal liquidity.
Yahoo Finance analyst Lockridge Okoth stated that a 98% probability of a rate hike could trigger the next liquidity shock for Bitcoin. Investing.com analysis指出 that yen appreciation and BTC weakness are often高度同步, a typical signal of rising global risk aversion.
Arthur Hayes has also emphasized in multiple analyses that the dynamics of yen carry trades remain a key variable affecting Bitcoin's liquidity,提醒 investors to watch for short-term liquidity shocks triggered by policy signals. In recent articles, Arthur Hayes emphasized the need to警惕 the叠加 impact of short-term energy costs and monetary policy risks; BTC/ETH may adjust in the short term along with risk assets, with the long term depending on liquidity restarting.
Conclusion:
Renewed concerns about a BOJ rate hike are not an isolated event but a signal of边际收紧 in global liquidity. Especially with multiple factors叠加—current Middle East geopolitical conflicts pushing up oil prices, AI capital expenditure consuming liquidity, and Federal Reserve policy uncertainty—the缓冲空间 is further compressed.
For investors, in the short term, global risk assets, particularly highly leveraged and high-valuation sectors (AI tech stocks and cryptocurrencies), may face significant pullback pressure, with volatility明显抬升. It is necessary to maintain high vigilance and be mindful of leverage risks.
