DBS Sees BOJ Hiking Every 3-4 Months to 1.75%, Putting Bitcoin (BTC) on Alert

Crypto News

DBS Group now expects the Bank of Japan to tighten on a faster schedule, projecting Japan's overnight call rate — the central bank's key policy gauge — to reach 1.75% by mid-2027. In a note published Aug. 18, DBS analysts forecast the interval between rate hikes could narrow to three to four months from roughly six months, and they pulled forward the next expected increase to September. The Bank of Japan's next policy meeting is scheduled for Sept. 17-18, followed by Oct. 29-30 and Dec. 17-18 meetings. DBS had previously seen the overnight call rate at 1.25% by the end of 2026 and 1.50% by mid-2027; the new 1.75% path reflects what the lender describes as more hawkish BOJ communication and weaker government resistance to earlier increases. The central bank last raised the rate by 25 basis points to 1.00% in June, a level DBS highlighted as the highest since September 1995. For digital assets, the relevant link runs through yen-funded liquidity and global yields: a faster BOJ path can strengthen the yen and push Japanese government bond yields higher, a combination that historically cools risk appetite. Bitcoin (BTC), the largest digital asset by market capitalization, was trading near $64,173.95, with the altcoin complex also watching the rate signal.

Morgan Stanley is forecasting a sharp repricing in older memory chips, a trend that could raise the cost of building crypto mining and AI data-center hardware. In its Greater China semiconductor report released Aug. 18, the bank said DDR4 prices could rise about 50% in the third quarter and continue with double-digit increases in the fourth quarter. Drivers include AI server demand spilling into consumer electronics and major memory makers reducing mature-product output such as DDR4. Morgan Stanley singled out SLC NAND, a one-bit-per-cell flash memory favored for reliability, as its preferred pricing play, projecting gains of more than 50% in both Q3 and Q4. It also flagged another possible NOR flash price increase in Q4. The bank upgraded earnings estimates for Winbond, Macronix, GigaDevice and Powerchip, with Macronix's 2026-2028 EPS forecasts raised by 139%, 144% and 147%, respectively. The bank kept an attractive rating on the sector and retained AP Memory as its top pick. For crypto, the read-through is indirect but relevant: mining rigs and AI data centers share the same semiconductor supply chains, so rising DDR4 and NAND costs feed into infrastructure expenses. The report does not treat memory prices as a direct token-market variable, but it underscores that the cost base for digital-asset computing is firming while Bitcoin and other cryptocurrencies remain well below their all-time high peaks.

London-based asset manager M&G Investments is betting that South Korean government bonds have been oversold, a contrarian call with regional risk-asset implications. M&G, which manages more than £300 billion for pension funds and insurers, added to Korean government bond holdings over the past two months. Its Asia fixed-income head, Low Guan Yi, argues markets have priced in too many Bank of Korea rate increases. The Bank of Korea lifted its benchmark rate by 25 basis points to 2.75% in July, the first hike since early 2023, after second-quarter GDP expanded 0.6% and July consumer prices rose 2.8%. Foreign investors sold about $1.2 billion of Korean bonds in July, the largest monthly net outflow since February 2025, and 10-year yields climbed 22 basis points since end-June. The KOSPI also suffered its steepest fall since 2008 earlier this month. M&G expects a tax-revenue windfall from Korean chip producers to let Seoul trim bond issuance, easing supply pressure even if the central bank stays hawkish. The call faces a test at the Bank of Korea's Aug. 27 meeting; a slower pace would confirm the firm's bond bet, while a fourth straight hike would validate current market pricing. For regional crypto trading, the Korean rate path matters because South Korea hosts one of the world's largest altcoin markets and a rate-sensitive retail base.

Drawn together, these stories show a macro backdrop where central-bank rate paths and computing costs are both firming. COINOTAG's tracked market shows Bitcoin dominance at 69.7%, aggregate market cap of $1.847 trillion and a Fear & Greed reading of 41 (Fear) — a defensive setup that keeps Bitcoin below its all-time high.