BOJ Board Member Urges Timely Rate Increases Amid Inflation Risks
Junko Koeda says inflation risks remain tilted upward as wages rise and price increases spread across consumer goods.
Key takeaways
- Junko Koeda said the BOJ should not be overly cautious about raising rates.
- She said underlying inflation appears to be settling around the BOJ’s 2% target.
Bank of Japan board member Junko Koeda said the central bank should not be overly cautious about raising interest rates, citing considerable upside risks to inflation.
Koeda said price increases across a wide range of consumer goods suggest underlying inflation is becoming anchored around the BOJ’s 2% target. She also pointed to steady wage growth as evidence of more durable progress toward sustained inflation.
Financial conditions remain accommodative despite past rate hikes, she said, with little sign that higher borrowing costs are hurting households or businesses. The BOJ raised its key rate to a 31-year high last month.
The BOJ may pause in October, but is likely to signal a December hike, according to sources cited by Reuters.
This article was produced with the help of AI technology. Based on reporting by the outlets listed above.
