BOJ board member Koeda (小枝) gave a speech and subsequently indicated at a press conference that the BOJ would proceed with normalisation cautiously, without rushing to raise rates. Koeda (小枝) presented a view of the neutral interest rate as a range, and was reported to intend to maintain the BOJ's current careful approach to explaining its policy.
BOJ board member Koeda (小枝) gave a speech, and expressed views at a press conference on the future conduct of monetary policy and the neutral interest rate. Koeda (小枝) is said to continue voting in line with the executive body and is regarded as an important figure for understanding the mainstream view within the BOJ. The speech attracted considerable attention as an indication of the BOJ's overall policy judgment.
The remarks that attracted particular attention concerned the stance on rate hikes. Koeda (小枝) said that, given the risk of rising prices in an accommodative environment, the BOJ would not be excessively cautious. However, the expression “will not be excessively cautious” can also be read as meaning “will remain moderately cautious,” and the author believes that the BOJ may be becoming more cautious internally as it approaches the neutral interest rate.
On the neutral interest rate, Koeda (小枝) said it should be viewed as a range and acknowledged that it would be difficult to indicate a precise figure. By avoiding reference to the specific level sought by the market, the BOJ's stance appears to be one of avoiding excessive emphasis on room for further rate hikes. Overall, the remarks have been interpreted as indicating that the BOJ as a whole shares a cautious decision-making process.
Regarding the pace of future rate hikes, Koeda (小枝) used the expression “it is better to do it when possible,” suggesting that the BOJ may become more cautious in its decisions if uncertainty over external conditions and the economic outlook increases. The BOJ is said to intend to continue making policy decisions while assessing the risks of both maintaining the current stance and raising rates further. Market participants are expected to understand the overall cautious decision-making process rather than focus solely on the wording used by hawkish and dovish officials.