Asia
Japan Shares Rise on BOJ Rate Hike Expectations
Japanese shares ended higher on Wednesday after the OECD projected the Bank of Japan's (BOJ) policy rate could rise to 2% by the end of 2027, reinforcing expectations of a sustained monetary-tightening cycle.The Nikkei 225 rose 0.8%, or 529.54 points, to close at 63,272.11.The OECD said the Japanese central bank's policy rate remains near the low end of the economy's neutral range and urged gradual rate hikes as inflation stays around 2% and demand continues to outpace supply.OECD Secretary-General Mathias Cormann said the pace of policy normalization could accelerate as Japan's economic equilibrium becomes clearer, though he said the BOJ was not yet "behind the curve."The OECD projected the BOJ's policy rate could reach 2% by end-2027 as the central bank continues unwinding monetary easing toward a neutral rate estimated at 1.1% to 2.5%.In economic news, Japan's current account surplus widened 29.1% year over year to 4.682 trillion yen in March, driven by higher primary income and a wider goods surplus.Japan's bank lending growth accelerated to 5.4% year over year in April, led by solid loan expansion at major banks and continued strength at regional lenders.On the corporate front, Bandai Namco (TYO:7832) rose 5% after reporting stronger fiscal 2026 profit and sales growth, driven by robust demand for its Gundam franchise and Toys and Hobby business.Tsugami (TYO:6101) climbed 7% after its China segment profit jumped 39% year over year on stronger revenue growth. Meanwhile, GNI Group (TYO:2160) advanced 9% after its liver fibrosis drug F351 was accepted for regulatory review in China with priority review status.
Nikkei 225TYO:2160TYO:6101TYO:7832