BOJ Set to Lift Rates to 1% as Ueda Misses 31-Year-High Decision
Updated
Updated · Reuters · Jun 12
BOJ Set to Lift Rates to 1% as Ueda Misses 31-Year-High Decision
3 articles · Updated · Reuters · Jun 12
Summary
June 16 is set to bring a BOJ rate increase to 1% from 0.75%, the highest level since 1995, even with Governor Kazuo Ueda absent for hospital treatment.
Inflation risks are driving the move: Japan's wholesale prices jumped 6.3% in May, while the Middle East war, a weak yen and a tight labour market are seen broadening price pressures.
Shinichi Uchida's post-meeting briefing is now the main focus for markets looking for clues on whether the BOJ will keep tightening after June or move more cautiously.
The bank is also expected to keep its current bond-buying taper pace beyond next fiscal year, balancing higher inflation against market jitters and uncertainty over the war's economic fallout.
A 1% policy rate would mark the BOJ's first hike since December and still sit near the bottom of its estimated 1.1%-2.5% neutral range, leaving room for a projected move to 1.25% later this year.