The minutes of the Bank of Japan’s September meeting showed that most policymakers shared the view that the accommodative environment would be maintained even after a rate hike. They indicated a policy of continuing to adjust the degree of easing while taking economic, price and financial developments into account.
According to the minutes of the Bank of Japan’s monetary policy meeting held on 17–18 September, many policymakers agreed that an accommodative financial environment would be maintained even if the policy rate were raised. The minutes indicate that the BOJ is placing importance on maintaining an accommodative environment while underlying inflation is near 2%.
Some policymakers noted that “including movements in asset prices such as higher stock prices and a weaker yen, financial conditions are accommodative in some respects.” Against this backdrop, the prevailing view was that a rate hike at the time of the meeting could coexist with an accommodative environment.
The policymakers agreed on a policy of continuing to raise the policy rate and adjust the degree of easing in response to future economic, price and financial developments. The BOJ left the rate at 1.25% at its September meeting, and markets are closely watching its rate-hike decisions from the next meeting onward.
In the foreign exchange market, dollar-yen at times traded in the low ¥157 range, with movements continuing to reflect the US-Japan interest-rate differential. Market attention also focused on developments at the RBA as an external factor.