BOJ policy board member Takata (高田) said that a substantial adjustment to deeply negative real policy rates is currently necessary. Yamashita (山下) cited the risk of an upside inflation surprise and the possibility of an earlier global shift toward interest-rate hikes, and called for a cautious approach to reducing government bond purchases.
BOJ policy board member Takata (高田) indicated that the current real policy rate needs to be revised significantly into negative territory. Although no specific figure or timing was given, Takata (高田) expressed a cautious view in light of current economic conditions.
Yamashita (山下), who was also present, said that 2026 will be a period in which discussions should place greater emphasis on upside inflation risks, and pointed to the possibility that the global shift toward interest-rate hikes could come sooner. Yamashita (山下) also said that the risk of inflation overshooting expectations should be kept in mind.
Yamashita (山下) further said that the process of reducing government bond purchases would require a cautious approach carried out over time. These remarks have heightened market attention to the future direction of the BOJ’s monetary policy.