BOJ dissenter Sato backs gradual rate increases without a fixed timetable

Bank of Japan board member Ayano Sato supports raising interest rates in stages despite voting against September's increase, according to a media report on October 7. She said the timing of further increases should reflect developments in consumption and income rather than follow a predetermined schedule.

Sato said in an interview that she opposed the September move because consumer spending lacked momentum and underlying inflation was not accelerating. She nevertheless viewed financial conditions as accommodative and supported gradual adjustments to rates.

Prime Minister Sanae Takaichi, who favors looser monetary policy, appointed Sato to the central bank's nine-member board in June. Sato was one of two members who dissented from the September decision, which took the policy rate to 1.25%, its highest level in 31 years.

Sato said rising crude oil prices associated with the Middle East conflict tilted inflation risks toward the upside. In a separate interview, she said underlying inflation was nearing the central bank's 2% target and characterized her monetary policy views as broadly similar to those of many fellow board members.

She also said rate increases could help deliver sustained economic growth. The BOJ would make policy independently, she said, while ultimately aligning with the administration's proactive fiscal approach.