BOJ Governor Ueda's comments at news conference
TLT•The Bank of Japan kept interest rates steady and said underlying inflation had reached levels consistent with its 2% target. Governor Kazuo Ueda said future rate hikes will depend on upcoming data, with the next increase possibly as soon as December.
1. Rates held steady
The Bank of Japan kept interest rates unchanged on Friday, while saying underlying inflation had reached levels consistent with its 2% target. Ueda said the central bank would remain vigilant about risks of inflation overshooting and would adjust policy as appropriate to anchor inflation around 2%.
2. Inflation risks broaden
Ueda said September and October data showed upward pressure from energy and raw material costs broadening from business-to-business prices to consumer prices. He said inflation expectations in Japan had yet to become anchored around the target, and that next year's wage talks would be important.
3. Future hikes depend on data
Ueda said the pace of future rate increases would depend heavily on upcoming data and that the BOJ could not decide in advance how many months it would wait between hikes. The bank will assess its baseline outlook and risks at each policy meeting, including its next meeting; Ueda said it also needed to scrutinise financial conditions and the cumulative impact of past rate increases.
