BOJ's Ueda stresses inflation risks ahead of October policy meeting
Japan's central bank governor said Middle East tensions, AI-related demand and currency movements could push underlying inflation above its 2% target.
BOJ's Ueda reaffirms rate hikes to keep inflation near 2%
Japan's central bank will issue new growth and inflation forecasts at its October 29-30 meeting, following rate increases in June and September.
Bank of Japan Governor Kazuo Ueda reaffirmed on October 16 that the central bank intends to keep raising interest rates, saying its priority is to hold underlying inflation near 2% rather than allow it to accelerate further.
Speaking at a Bangkok news conference, Ueda said Japanese data and his exchanges with international policymakers indicated that the economy and prices were developing broadly as the BOJ expected. With underlying inflation close to its goal, he said, keeping it there had become a more important policy consideration.
The BOJ will publish updated quarterly forecasts for growth and inflation at its October 29-30 policy meeting. Its policy rate stands at 1.25% after increases in June and September. Many at the bank favor leaving rates unchanged in October while assessing the effects of earlier increases, according to a media report citing sources.
Ueda said discussions with other policymakers suggested their views on global inflation were not substantially different from the BOJ's. However, he found that more of them regarded global demand linked to artificial intelligence as somewhat stronger than the Japanese central bank had anticipated.
US Treasury Under Secretary Erin Browne also urged further Japanese monetary tightening on October 16 to prevent disorderly declines in the yen. She said Japan needed to adapt policy to an economy that was no longer experiencing deflation.