Analysis: Market expectations of a Bank of Japan rate hike on January 24 may trigger a new round of unwinding in yen carry trades.

TechFlow news, January 16 — According to CoinDesk, market expectations indicate a 90% probability that the Bank of Japan will raise interest rates during its meeting on January 24, pushing the yen to its strongest level in a month at 156 against the U.S. dollar. Japan's annual inflation rate is currently at a three-month high of 2.9%, and the central bank may lift interest rates from 0.25% to 0.45%.

Markets are closely watching the inflation data release on January 23. If inflation exceeds expectations, it could trigger a fresh unwind of yen carry trades, potentially repeating last August's scenario when Bitcoin plunged to $49,000. Notably, this monetary decision will come after Donald Trump’s inauguration (January 20), and the convergence of these two events may jointly influence the trajectory of the cryptocurrency market.