BOJ May Be Forced to Hike Rates Rapidly if Inflation Accelerates, Board Member Masu Says
- On Thursday, Bank of Japan board member Kazuyuki Masu warned the central bank may need to raise interest rates rapidly if inflation accelerates, noting that "financial conditions in Japan remain accommodative."
- Broadening price pressures from the Middle East conflict and a weak yen have pushed underlying inflation "very close" to the BOJ's 2 per cent target, Masu said. Rising fuel and chemical prices could have lasting effects on overall costs.
- BOJ staff estimates place Japan's nominal neutral rate between 1.1% and 2.5%, supporting further policy rate increases after the Bank raised rates to a 31-year high of 1% in June.
- The yen rose against the dollar following Masu's remarks, while pressure from U.S. Treasury Secretary Scott Bessent and hawkish BOJ commentary have cemented expectations for an interest rate hike this month.
- Analysts polled by Reuters expect the BOJ to hike rates to 1.25 per cent next week and then to 1.75 per cent in the second quarter of 2027, as policymakers monitor concerns over "potential overheating" in corporate investment.
11 Articles
11 Articles
BOJ’s Masu Says Will Continue to Raise Benchmark Rate
The Bank of Japan will continue to raise its benchmark interest rate to ensure that the price trend doesn’t exceed 2%, board member Kazuyuki Masu said, in comments that support widespread expectations that the bank will raise borrowing costs next week.
(Seoul = Yonhap News) Reporter Hwang Jung-woo = Bank of Japan (BOJ) Board Member Kazuyuki Masu [stated that] the Bank of Japan [will] [keep] the base interest rate [calculated] to ensure the underlying inflation rate does not exceed 2%...
BOJ policymaker warns of price risks that may trigger rapid rate hikes
FUKUI, Japan, Sept 10 : The Bank of Japan may eventually be forced to raise interest rates rapidly if inflation accelerates given the country's loose financial conditions, board member Kazuyuki Masu said, warning of price risks that solidify the chance of a September hike.In a closely watched speech ahead of
BOJ may be forced to hike rates rapidly if inflation accelerates, board member Masu says
By Leika Kihara FUKUI, Japan, Sept 10 (Reuters) - The Bank of Japan may be forced to raise interest rates rapidly if inflation accelerates as the country's financial conditions remain accommodative, board member Kazuyuki Masu said on Thursday. A rece...
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