Analysis: Markets expect the Bank of Japan will raise interest rates on January 24, or trigger a new round of yen carry trade lifting

On January 16, it was reported that the yen has risen to its strongest level in a month against the dollar as the market expects the Bank of Japan to raise interest rates at its January 24 meeting with a 90% probability.156 Japan's annual inflation rate is now at a three-month high of 2.9%, and the central bank may raise interest rates from 0.25% to 0.45%.

The market is closely watching the release of inflation data on January 23rd, which, if it exceeds expectations, could trigger a new round of yen carry trades to unwind, repeating Bitcoin's fall to $49,000 in August last year. It is worth noting that this decision will come after the inauguration of Donald Trump (January 20), two major events may overlap to affect the cryptocurrency market trend.