BOJ Governor Ueda (植田) indicated the importance of stabilizing prices at around 2% while remaining alert to the risk of prices rising above that level. He indicated that the timing of an additional rate hike would be considered based on the outlook in the Outlook Report.
BOJ Governor Kazuo Ueda (植田和男) said that future monetary policy should take into account the risk of the underlying inflation rate rising above 2%, and indicated a policy of placing importance on stability at around 2%. The remarks were delivered at the National Credit Union Convention and read out by Deputy Governor Uchida (内田).
After raising the interest rate to around 1.25% at the previous policy meeting in September, the Governor said that accommodative financial conditions would remain in place. He explained that real interest rates remained low, corporate demand for funds was increasing, and financial institutions continued to take an active lending stance.
He indicated that attention should be paid to the possibility that developments in the Middle East, expanding AI-related demand and foreign-exchange fluctuations could affect the economy and prices, and stated that the Bank would raise its policy rate in response to price and economic conditions and adjust the degree of easing.
He said that the timing and pace of additional rate hikes would be considered based on the outlook in the Outlook Report published by the Bank of Japan, while examining the likelihood of the central outlook for economic, price and financial conditions being realized and the associated risks.