BOJ is on track for another interest rate hike amid economic woes

The Bank of Japan (BOJ) had the key rate hike a year ago and is still on a tightening path. Bloomberg reports that's driving big changes in the country’s economy.

The Japanese regulator's policy has pushed the yield on 10-year government bonds to a 17-year high. This uptick escalates the costs of servicing the public debt, which makes up nearly a quarter of the national budget.

On the flip side of the coin, the Central Bank is keeping inflation near target levels. No doubt that it faces growing discontent from the public. According to Bloomberg, household budgets are being squeezed by higher food prices. Amidst this backdrop, the country's economic growth is slowing down, and consumer activity is weakening.

Although the economy is struggling, experts predict another rate hike for July, which would further restrict consumers and state finances.