BOJ Policymaker Calls for “Nimble” Rate Hikes

Sapporo, Sept. 2 (Jiji Press)–The Bank of Japan has entered a new phase this year in which the central bank will raise interest rates in a nimble manner, policymaker Hajime Takata said Wednesday. “While rate hikes were conducted at a moderate pace from 2024 to 2025, with two rate hikes a year, 2026 represents the start of a new phase, in which rate hikes will not be carried out at a fixed pace but will instead be conducted in a nimble manner,” Takata said in a speech in Sapporo, the capital of Hokkaido, the country’s northernmost prefecture. The BOJ’s 2 pct inflation target “has almost been achieved,” he said. “I consider it necessary for the bank to…demonstrate to the market its determination to prevent upward deviations in prices, while giving consideration to the impact through foreign exchange markets,” he said, stressing the need to prevent import-driven inflation spurred by a weak yen. Referring to the BOJ’s reduction of its Japanese government bond purchases as part of monetary policy normalization, Takata said it was important to “ensure stability and thereby avoid causing extreme volatility.” In exceptional circumstances, such as a spike in long-term interest rates, the BOJ will “make nimble responses by, for example, increasing the amount of JGB purchases,” he said. END [Copyright The Jiji Press, Ltd.]