At its September monetary policy meeting, the BOJ raised the policy rate from 1.0% to 1.25%. The decision passed by 7 votes to 2, with Committee members Asada (浅田) and Sato (佐藤) voting against it.
The Bank of Japan held its monetary policy meeting on 17 and 18 September and decided to raise the policy rate by 0.25 percentage points, from 1.0% to 1.25%. The market had broadly priced in a rate hike ahead of the meeting, and the decision passed by a 7-to-2 majority.
The dissenting votes came from Committee members Asada (浅田) and Sato (佐藤), who cited their respective assessments of price trends and the strength of the economy. The statement was largely unchanged from the previous policy guidance, maintaining that financial conditions remain accommodative and that the BOJ would continue raising rates in line with economic and price developments.
Governor Ueda (植田) said at the press conference that “the policy phase has changed,” indicating that the phase concerning the achievement of price stability had shifted to one of stability around 2%. He said that future rate hikes would not be based on an assumption of increases every three months, with the pace of policy adjustment depending on price developments, while indicating that the BOJ would continue considering the matter at this and subsequent meetings.
Although the market remained mindful of downward pressure on the yen and the possibility of rising ultra-long-term interest rates, it appeared to maintain a cautious stance toward any rapid additional rate hikes. The yen initially strengthened in response, but later traded again in the ¥157 range, indicating that the short-term reaction was limited.