The Governor of the Bank of Japan, Kazuo Ueda, just issued a stern warning: if the economy and prices develop as forecasted, the central bank is prepared to continue raising interest rates! This is no joke; the "water level" of the global liquidity pool is likely to change dramatically.
Japan has been implementing ultra-loose monetary policy for a long time, serving as the "big faucet" of global liquidity. Now, with the intention to tighten the valve, the chain reaction could be significant. If the yen continues to strengthen, some arbitrage funds are likely to flow back; Asian market sentiment will also be affected, creating a tense market atmosphere; and in our crypto market, volatility is likely to suddenly increase.
The current market is already sensitive; even a slight change in the major central banks' stance can trigger a huge ripple effect. The last time Japan adjusted its policy, it caused quite a stir. The biggest question now is: how fast will the rate hike proceed? Will this "black swan" really flap its wings and fly out, causing the market's liquidity feast to lose a "wine glass"? $BNB $SOL $XRP
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