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Sources: Bank of Japan Expected to Maintain Gradual Rate Hike Stance Despite Prime Minister's Election Setback
Summary: According to sources, Bank of Japan officials believe that there is little need to change their gradual rate hike monetary policy stance following Prime Minister Shizuka Kishi's setback in the Senate elections. Despite closely monitoring government fiscal policy developments, officials still consider it appropriate to continue raising benchmark interest rates if economic outlook remains on ...
According to sources, Bank of Japan officials believe that there is little need to change their gradual rate hike monetary policy stance following Prime Minister Shizuka Kishi's setback in the Senate elections. Despite closely monitoring government fiscal policy developments, officials still consider it appropriate to continue raising benchmark interest rates if economic outlook remains on track. Sources indicate that the policy committee led by BOJ Governor Haruhiko Kuroda is likely to keep the rate unchanged at 0.5% at the upcoming meeting. With ongoing US-Japan trade negotiations, officials hope to assess the impact of the agreement on inflation trends and economic outlook before further rate hikes. While the election results are not expected to alter the BOJ's policy trajectory, some officials are wary of the inflation risks posed by significant fiscal easing. Rising food prices, particularly rice, have already exceeded expectations, prompting officials to take note of increasing inflation risks.
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Link: Sources: Bank of Japan Expected to Maintain Gradual Rate Hike Stance Despite Prime Minister's Election Setback [Copy]
