Bank of Japan board members believe that interest rate hikes will have a limited impact on corporate capital expenditures, and the market expects a rate hike in December.

The minutes of the Bank of Japan's September meeting showed that policymakers believed there was still room for interest rate hikes, supporting market expectations that the bank would raise rates in December. A member of the policy board noted that feedback from businesses indicated that previous rate hikes and the possibility of further hikes in the near future had had limited impact on business operations, with almost no companies reducing capital expenditures due to rising borrowing costs. Another committee member stated that the recent stock market rally and weakening yen have eased the financial environment for businesses. Given the persistent inflation, many economists expect the Bank of Japan's final interest rate to exceed 1.75%. (Source: Jinshi Data)