BOJ Policymaker Calls for Continuing Rate Hikes

Kyoto, Feb. 26 (Jiji Press)–Bank of Japan policymaker Hajime Takata on Thursday stressed the need to continue raising interest rates. “Our basic stance is to continue (raising interest rates) gradually,” Takata told a press conference in the western city of Kyoto. At the BOJ’s previous policy-setting meeting last month, Takata proposed raising the policy interest rate from 0.75 pct to 1 pct, but the central bank’s Policy Board decided by a majority vote to hold the rate steady. When asked if he plans to propose a rate hike again at the next policy-setting meeting in March, Takata said he will consider such a proposal at each meeting. He noted that the pace of interest rate hikes is “up to the (financial) environment and data.” Earlier in the day, Takata said in a speech that central banks around the world may shift from cutting rates to raising them this year. “It is necessary to bear in mind the risk that Japan might face a greater-than-expected upswing in prices,” he said. Regarding this, the BOJ policymaker said at the press conference that the BOJ is not currently falling behind the curve in terms of rate hikes, adding, “We’ll take measures to avoid such a situation as much as possible.” During the speech, Takata said, “The fear of Japan’s economy returning to deflation has been dispelled.” “I view that a ‘true dawn’ is finally within sight and, on this basis, consider the bank to be in the process of gradually shifting gears,” he said. END [Copyright The Jiji Press, Ltd.]