BOJ vows not to tolerate further inflation rise above 2%: Ueda
Bank of Japan Governor Kazuo Ueda said Friday (October 16) that he cannot tolerate underlying inflation rising further above 2%.
Excluding temporary factors, the underlying inflation rate is quite close to the BOJ's 2% target, Ueda reiterated after a series of meetings, including a gathering of finance ministers and central bank chiefs from the Group of 20 major economies.
"Stabilising inflation at around 2% is becoming more important than before," he said at a press conference in Bangkok, Thailand, suggesting that the BOJ will continue raising interest rates.
At its September policy-setting meeting, the BOJ decided to raise its policy rate to around 1.25%.
Ueda said that financial conditions remain accommodative.
He said that the BOJ would consider the timing and pace of future rate hikes based on the situation in the Middle East and trends in artificial intelligence-related demand and foreign exchange rates.
The BOJ places importance on underlying inflation in its monetary policy management and has projected that the inflation rate will reach 2% sometime between the second half of fiscal 2026 and fiscal 2027.
Asked whether the BOJ would conclude at its next policy-setting meeting, scheduled for late October, that the price target had been reached, Ueda said, "We will discuss the matter thoroughly and reach a conclusion based on the information available by then."
[Copyright The Jiji Press, Ltd.]
