At a speech in Nagasaki, Bank of Japan Policy Board Member Asada (浅田) took a cautious stance, saying that the pace of additional rate hikes requires close attention.
Bank of Japan Policy Board Member Asada Toichiro (浅田統一郎) gave a speech in Nagasaki and said that the pace should be carefully considered when proceeding with rate hikes.
At its September monetary policy meeting, the Bank of Japan raised its policy rate to approximately 1.25%, then decided to hold it steady at the October meeting. Asada (浅田) estimates the neutral rate at approximately 1.1%–2.5% and pointed out that, although current financial conditions remain accommodative, the degree of accommodation is gradually declining.
At its October meeting, the Bank of Japan judged that the underlying inflation rate had reached 2%, and Asada (浅田) agreed. However, given weak growth in private consumption, he said that close attention should be paid to the risk that a rate hike could weaken the economy and push down the underlying inflation rate.