KUALA LUMPUR, June 16 (Bernama) -- Bursa Malaysia’s key index extended its rebound for a second consecutive day, closing more than one per cent higher,yh as investor sentiment remained buoyant amid improving regional market conditions and sustained buying interest in heavyweight counters. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose by 18.60 points, or 1.10 per cent, to 1,709.99 from yesterday's close of 1,691.39. The key index opened 0.07 of a point weaker at 1,691.32 and moved between 1,685.57 and 1,711.20 throughout the session. Market breadth was positive, with gainers outpacing losers 600 to 552, while 566 counters were unchanged, 991 untraded and 25 suspended. Turnover declined to 3.93 billion units worth RM3.45 billion from 5.02 billion units worth RM3.91 billion on Monday.
Japan has officially entered a new era of monetary policy and markets are paying attention.
Key Points
- BOJ raises interest rate to 1% — highest since 1995
- Marks a clear shift away from ultra-loose policy era
- Signals further policy normalisation ahead
- Bond purchases to remain steady until April 2027
- Decision passed 7-1 vote, showing broad support
- Meeting held without Governor Kazuo Ueda (hospitalised)
Japan is no longer the world’s last ultra-low-rate holdout and that changes global capital flows.
Why This Matters
For years, Japan anchored global liquidity with:
- Near-zero interest rates
- Massive bond buying
- Cheap funding for global investors
Now, that anchor is shifting.
Higher Japanese rates = less global liquidity + potential capital rotation back to Japan
Market Impact to Watch
- Yen: Likely to strengthen over time
- Global bonds: Upward pressure on yields
- Equities: Possible volatility as cheap liquidity fades
This could trigger an unwinding of the yen carry trade, a major driver of global asset flows.
Bigger Picture
This move completes a full cycle:
- From negative rates & yield curve control
- To rate hikes and normalization
Japan is aligning closer with other major central banks after years of divergence.
Key Takeaway
The BOJ’s rate hike is more than a domestic policy shift, it’s a global liquidity turning point.
- Signals end of ultra-cheap money from Japan
- May reshape capital flows and risk appetite globally
- Adds another layer of uncertainty to already volatile markets
This shift reveals where the next risks and opportunities may emerge in global markets.
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