The Bank of Japan (BOJ) is set to consider corporate funding risks in its upcoming policy decision, adding complexity to the central bank's inflation outlook. Private sector members of the economic and fiscal policy council have urged the BOJ to track financial market funding and price trends together.
This request follows a divided central bank decision last month, where officials kept policy unchanged. The 6-3 vote showed wider support for another rate hike among rate-setting officials.
Bitcoin traders face a direct link to Japan's rate outlook through the yen carry trade. Traders borrow low-yielding yen and move funds into higher-return markets during calm policy periods. Higher Japanese rates can force selling across Bitcoin and other risk assets.