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The Bank of Japan yesterday directly raised the interest rate to 0.75%, the highest level in thirty years. Normally, a rate hike would scare off investors, but the reality was the opposite — the Nikkei index surged straight up, and global risk assets exhaled a sigh of relief. What’s behind this contrast?

In simple terms, the negative factors have been fully digested.

**The market has long since fully understood this rate hike.** It’s not a sudden surprise; expectations had been built up long ago. When the rate hike finally lands, everyone’s nerves are actually eased. The decline has already happened when it was supposed to.

**On paper, it looks tight, but in reality, it’s still loose.** The 0.75% figure sounds firm, but compared to over 3% inflation, the real interest rate remains deeply negative. In other words, money is still cheap, and liquidity continues to flow abundantly.

**The real signal behind this rate hike is even more important —** Japan is finally emerging from thirty years of deflation. Wages are rising, prices are increasing, and this marks the beginning of a healthy cycle. The economy’s foundation is solid, which instead reassures global investors.

**What about opportunities?**

Japan’s domestic stock market is definitely going to be excited for a while, with banking, consumer, and technology sectors benefiting first. The yen’s appreciation is moderate and controllable, global carry trades continue as usual, and import-oriented companies can even breathe a sigh of relief. For the global market — including cryptocurrencies — this is actually a positive signal. A healthy, predictable Japanese economy means a more stable global liquidity landscape.

From another perspective, this isn’t the start of tightening risks, but rather a health check report for a “deflation patient’s discharge.” The market’s celebration isn’t just about the rate hike itself, but that the greatest uncertainty has finally been cleared, and the outcome is much smoother than expected.

What do you think about this wave? Is it a “steadying hand” for the global markets, or a prelude to subsequent volatility? Share your thoughts in the comments.

(Information from public reports, for market insight only, not investment advice)