Bank of Japan deputy governor hints: unlikely to raise interest rates for two consecutive meetings

Odaily reports that Shinichi Uchida, Deputy Governor of the Bank of Japan, hinted in a speech that the benchmark interest rate will continue to be gradually raised, which may help allay speculation about an early rate hike. On Wednesday, Uchida told business leaders: "If the economic outlook materializes, the Bank of Japan will continue to raise the policy interest rate accordingly and adjust the degree of monetary easing. In this regard, the key point of the outlook is that the central bank expects to achieve its 2% price stability target." Uchida said officials would have to monitor the economy's reaction to each rate hike, as the central bank has raised rates three times in the past 12 months, because it is difficult to accurately judge where the neutral rate that is neither restrictive nor stimulative is. This comment suggests that the central bank is unlikely to raise rates at two consecutive meetings, including a rate hike in January and another in March. He hinted that based on a series of estimates, the benchmark rate could rise to at least 1% by the end of fiscal year 2026. (Jinshi)