Bank of Japan Deputy Governor Himino Ryozo (氷見野良三) held a press conference in Saitama and said it was necessary to remain more alert than before to the risk of prices rising. He indicated that the BOJ would continue considering a rate hike at meetings including the 17-18 September policy meeting.
Bank of Japan Deputy Governor Himino Ryozo (氷見野良三) said at a press conference in Saitama on the 27th that it was necessary to remain more alert than before to the risk of prices rising above expectations. He cited higher crude oil prices, the yen's depreciation and increased AI demand as concerns that could push up prices.
Markets are pricing in a probability of more than 80% that the BOJ will raise rates at its September meeting, but Himino Ryozo (氷見野良三) did not specify when the decision would be made. He also referred to the intervention in July to correct the yen's depreciation as a factor that had raised expectations for a rate hike, drawing increased attention to the BOJ's decision.
In a speech before the press conference, he described current financial conditions as accommodative while emphasizing the stance of continuing to raise the policy rate and adjust the degree of monetary easing. He said delayed rate hikes could fuel inflation and potentially affect small and medium-sized enterprises, mortgage borrowers and public finances.
At its June meeting, the BOJ raised its policy rate to around 1.0%, the highest level in 31 years, but left it unchanged in July. If an additional rate hike is decided at the September meeting, the pace of rate increases could be faster than before.
Himino Ryozo (氷見野良三) said only that the timing and pace of rate hikes would continue to be considered while examining the likelihood of the central outlook for the economy and prices being realized, along with the associated risks.