Goldman Sachs Japan economist Tomohiro Ota noted in an August 25 research report that the Bank of Japan (BOJ) is now expected to raise interest rates by 25 basis points in September, increasing the uncollateralized overnight call rate target from 1% to 1.25%. Subsequent rate hikes are expected in January and July 2027, with the policy rate ultimately reaching 1.75%. The core of this adjustment lies in the Japanese yen exchange rate approaching a sensitive range and medium-to-long-term inflation expectations nearing 2%, with exchange rate stability replacing wage data as the most urgent variable.