World news | The Guardian
· collected 2026-09-04 · by Heather Stewart and Graeme Wearden
The Bank of Japan is expected to raise interest rates amid speculation fueled by comments from a policymaker, Hajime Takata, suggesting the need for more "nimbly" action. The yen has surged over 2% against the dollar, reaching its highest level in a month, and markets believe there's a 77% chance of a rate hike at the BoJ's next meeting on September 17. Global markets have been jittery due to a government bond sell-off caused by fears of inflation increase, with investors reassessing interest rate expectations worldwide. The Bank of Japan has kept its main policy rate unchanged at 1% since July.
Written by the local model on 2026-09-05,
using this article's own text rather than the other coverage of the
same event (that is the story summary below).
Story summary
The Japanese yen has soared by more than 2% against the dollar amid speculation that the Bank of Japan is set to raise interest rates. This latest jump, which lifted the yen to its highest level against the dollar in a month at 155.57, followed a 0.9% move the previous day. Global markets are jittery after a dramatic government bond sell-off caused by fears of higher inflation due to rising oil prices. Investors are reassessing their expectations for interest rates, not only in Japan but also across other major economies. Remarks from Bank of Japan policymaker Hajime Takata, suggesting the need to move more "nimbly", have heightened prospects of a decisive rate hike. Market analysts believe that Takata's comments were a strong indication of an expedited rate hike trajectory, according to Citi's analysis. The yen's appreciation has left financial experts like Nigel Green, chief executive of deVere, describing markets as "febrile and jumpy".
Written for “Japanese Interest Rate Hike” on 2026-09-05,
grounded in this article and the 0 other(s) covering the same event.
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No political leaning scored for article 4258 · logged 2026-09-05
The Japanese yen has soared by more than 2% against the dollar amid speculation the Bank of Japan is set to raise interest rates.
asserted
Bank → soar → rates
The latest jump on Thursday lifted the yen to its highest level against the dollar in a month, at 155.57, and followed a 0.9% move the previous day.
Global markets remain jittery after this week’s dramatic government bond sell-off – caused by fears of a fresh inflation increase as a result of higher oil prices.
asserted
markets → lift → prices
Investors have been reassessing their expectations for the future path of interest rates, in Japan and across other major economies.
asserted
Investors → reassess → economies
Remarks by a Bank of Japan policymaker, Hajime Takata, suggesting it needs to move more “nimbly”, appeared to have heightened the prospects of a decisive move.
asserted
it → suggest → move
The chief executive of the financial adviser deVere, Nigel Green, said the scale of the yen appreciation over such a short time period underlined the febrile state of markets.
asserted
scale → say → markets
“Markets this jumpy don’t need a shock to move hard, a rumour is enough,” he said.
asserted
he → need → shock
Citi said in a note to clients that Takata’s remarks were the “strongest messaging we’ve heard from the board and reintroduces the idea of an expedited rate hike trajectory”.
asserted
we → say → trajectory
The Bank of Japan has been incrementally raising rates for the past two years, after the economy finally shrugged off decades of deflation, or falling prices – but its main policy rate was left unchanged at 1% in July.
asserted
rate → raise → July
Markets now believe there is a 77% chance of a rate rise at the BoJ’s next meeting, which starts on 17 September.
asserted
which → believe → September
Commenting on the latest market moves, Japan’s vice-finance minister for international affairs, Atsushi Mimura, said he was “neither satisfied nor reassured”, and policymakers “remain on a state of heightened alert”.
asserted
policymakers → comment → alert
The global bond market sell-off – pushing up the yield, or interest rate, on government borrowing – intensified earlier this week after the US Federal Reserve chair, Kevin Warsh, used a speech last Friday to indicate that he was determined to bring inflation back to target.
asserted
he → push → target
Warsh had previously baffled some investors by withdrawing the Fed’s approach of signalling future rate moves, known as “forward guidance” – but in Friday’s speech at the central bankers’ conference in Jackson Hole, he said that if inflation did not move towards the 2% target the Fed would have “more to do”.
asserted
Fed → baffle → more
The dollar weakened on Thursday after the Fed governor Christopher Waller indicated he was leaning towards keeping interest rates steady at this month’s meeting of Fed rate-setters.
asserted
he → weaken → setters
“I’m going to paraphrase John Lennon here: ‘give disinflation a chance’.
asserted
I → go → chance
We can wait one meeting,” Waller told Reuters.
asserted
Waller → wait → Reuters
The dollar dropped further against the yen after his comments, and was also weaker against the pound and the euro.
The bond sell-off appeared to have eased on Thursday, with yields on 10-year UK government bonds, known as gilts, hovering at about 5.1% in morning trading – having touched the highest level since 2008, close to 5.3%, earlier this week.
asserted
yields → drop → 2008
