At its September monetary policy meeting, the BOJ changed its policy rate from 1.0% to 1.25%, and some views called for the pace of rate hikes to be accelerated if signs of an upside surprise in prices emerge going forward.
The BOJ decided at its September meeting to change its policy rate from 1.0% to 1.25%. This was the first rate hike in 3 months and accelerated the previous pace of roughly once every 6 months. The meeting was attended by 9 policy board members.
Among the key views published from the meeting was the view that, in light of the risk of an upside surprise in prices, the pace of rate hikes would have to be accelerated if signs of an upside surprise emerged. This is expected to be an important focus of monetary policy going forward.
Within the BOJ, members discussed how to maintain consistency between price trends and monetary policy in connection with the rate hike decision and the outlook ahead. Along with inflation trends in the US and Europe and growth in domestic demand, these factors are expected to influence policy decisions from the next meeting onward.
Markets and readers are focused on when and how quickly the pace of future rate hikes will be decided, as well as trends in indicators that will inform the assessment of whether prices will move sustainably higher.