The Bank of Japan keeps interest rates unchanged, and the market pullback over the past two days is due to this. Previously, market expectations were generally that the Bank of Japan would raise rates, but judging from remarks by the Bank of Japan’s officials today, the Bank of Japan may raise interest rates in June.

The yen is actually an important source of global U.S. dollar liquidity. Many funds borrow yen at low interest rates, then exchange it for dollars to invest in markets with higher returns. This is a typical carry trade. But if Japan raises interest rates, these leveraged positions would be forced to unwind, and liquidity would be rapidly withdrawn.
Many people may not realize the importance of Japan’s interest rates in everyday life, thinking that global liquidity mainly depends on the Federal Reserve. But in reality, Japan’s ultra-low interest rates are one of the “water taps” for global funds. Once rates are raised and the tap is turned down, global markets will tighten as well.
On March 19, 2024, when the Bank of Japan raised interest rates, the U.S. stock market and the crypto bull market abruptly came to an end. On July 31, 2024, when the Bank of Japan raised rates again, Bitcoin fell from 62k to 49k. On December 2025, when the Bank of Japan raised interest rates, Bitcoin fell from 116k to 80k. So, closely watch the Bank of Japan’s actions in June. #WCTC交易王PK