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☆ Japan's central bank just raised interest rates for the first time in 17 years
▼ + stars: | 2024-03-19 | by ( Yuri Kageyama | Associated Press | ) www.businessinsider.com time to read: +4 min

Read previewTOKYO (AP) — Japan's central bank raised its benchmark interest rate Tuesday for the first time in 17 years, ending a longstanding policy of negative rates meant to boost the economy. The short-term rate was raised to a range of 0 to 0.1% from minus 0.1% at a policy meeting that confirmed expectations of a shift away from ultra-lax monetary policy. The negative interest rate policy, combined with other measures to inject money into the economy and keep borrowing costs low, "have fulfilled their roles," the bank said in a statement. The Japanese central bank's policy is quite different from those of the US Federal Reserve and the European Central Bank. Analysts expect the Bank of Japan to continue to move slowly on further raising interest rates.

Persons: —, Kazuo Ueda, Haruhiko Kuroda Organizations: Service, Business, Bank of, Bank of Japan, US Federal Reserve, European Central Bank Locations: Japan, Bank of Japan, U.S, China

TOKYO (AP) — Japan’s central bank raised its benchmark interest rate Tuesday for the first time in 17 years, ending a longstanding policy of negative rates meant to boost the economy. The negative interest rate policy, combined with other measures to inject money into the economy and keep borrowing costs low, “have fulfilled their roles,” Bank of Japan Gov. But it had remained cautious about “normalizing” monetary policy, or ending negative borrowing rates, even after data showed inflation at about that rate in recent months. Ueda said there was “a positive cycle” of a gradual rise of wages and prices, while stressing that monetary policy will remain easy for some time. The Japanese central bank's policy is quite different from those of the U.S. Federal Reserve and the European Central Bank.

Persons: “, Kazuo Ueda, Ueda, Harumi Taguchi, Haruhiko Kuroda, ___ Yuri Kageyama Organizations: TOKYO, ” Bank of Japan Gov, Bank of, Analysts, P Global Market Intelligence, U.S . Federal Reserve, European Central Bank, Bank of Japan Locations: Japan, Bank of Japan, U.S, China

☆ BOJ's hawkish rhetoric signals chance negative rates may end soon
▼ + stars: | 2023-11-15 | by ( Leika Kihara | ) www.reuters.com time to read: +5 min

Having watered down YCC at its last policy meeting, the BOJ's next goal is to pull short-term rates out of negative territory early next year, sources have told Reuters. That leaves open the chance of an policy change in January, when the BOJ next reviews its quarterly price forecasts. Most expect an end to both YCC and negative rates. "It's an awfully big upgrade and shows how the BOJ had made estimates that were way too low," said former BOJ top economist Hideo Hayakawa, who expects negative rates to end in April. Even if it ends negative rates, nominal short-term borrowing costs will remain well below levels that neither stimulate nor cool the economy - estimated by analysts to stand somewhere near 2%.

Persons: Issei Kato, Ueda, Kazuo Ueda's, Haruhiko Kuroda, Kuroda, Mari Iwashita, Hideo Hayakawa, Takahide, Leika Kihara, Takahiko Wada, Sam Holmes Organizations: Bank of Japan, REUTERS, Daiwa Securities, Japan Center for Economic Research, Thomson Locations: Tokyo, Japan, TOKYO, U.S

☆ BOJ chooses slow path out of zero-rate limbo
▼ + stars: | 2023-10-31 | by ( Peter Thal Larsen | ) www.reuters.com time to read: +4 min

REUTERS/Susana Vera Acquire Licensing RightsHONG KONG, Oct 31 (Reuters Breakingviews) - The Bank of Japan (8301.T) is taking the long road out of zero-interest rate limbo. On the face of it, BOJ Governor Kazuo Ueda and his colleagues made few policy changes at their latest meeting. The short-term interest rate remains negative, while the official yield target for 10-year Japanese government bonds is unchanged at 0%. However, the real challenge for Ueda is when to end the era of negative short-term interest rates. The BOJ’s nine-member board maintained its target for short-term interest rates of -0.1%.

Persons: Kazuo Ueda, Susana Vera, Haruhiko Kuroda, Ueda, “, Antony Currie, Thomas Shum Organizations: Japan, International Monetary Fund, World Bank, REUTERS, Reuters, Bank of Japan, U.S, Thomson Locations: Marrakech, Morocco, HONG KONG, Japan

☆ BOJ dispels view risk of loss will impede easy-policy exit
▼ + stars: | 2023-09-30 | by ( Leika Kihara | ) www.reuters.com time to read: +3 min

Bank of Japan Governor Kazuo Ueda speaks at a group interview with media in Tokyo, Japan, May 25, 2023. "The objective of the Bank's monetary policy is achieving price stability, which is its mission as stipulated by law. "A central bank's ability to conduct monetary policy is not impaired by a temporary decrease in its profits and capital, provided that it conducts appropriate monetary policy," he said. Some academics have warned the BOJ's huge balance sheet will make an exit from ultra-loose policy difficult by exposing it to massive losses that could put its credibility on the line. But he has also said the BOJ will consider an exit when sustained, stable achievement of its price target is in sight.

Persons: Kazuo Ueda, Kim Kyung, Ueda, Haruhiko, Leika Kihara, William Mallard, Sonali Paul, Michael Perry Organizations: Japan, REUTERS, Bank of Japan, Japan Society of Monetary, Thomson Locations: Tokyo, Japan, TOKYO

☆ BOJ to heighten scrutiny on rising prices, yields at policy meeting
▼ + stars: | 2023-09-21 | by ( Leika Kihara | ) www.reuters.com time to read: +3 min

All economists surveyed in a Reuters poll expect the central bank to maintain its short-term interest rate target of -0.1% and that for the 10-year bond yield around 0%. Ueda told a recent interview the BOJ could have enough data by year-end to determine whether to end negative rates, heightening market expectations of a near-term policy shift. A Reuters poll for September showed most economists predicting an end to negative interest rates in 2024. Growing prospects of longer-for-higher U.S. interest rates have pushed the yen down near the 150-per-dollar level seen as Tokyo’s line-in-the-sand for possible currency intervention. Mari Iwashita, chief market economist at Daiwa Securities, expects the BOJ to tweak its dovish forward guidance in October and end its negative rate policy early next year.

Persons: Issei Kato, Kazuo Ueda’s, Ueda, Haruhiko, Mari Iwashita, ” Organizations: Bank of, Bank of Japan, REUTERS, Daiwa Securities Locations: TOKYO, Bank of Japan, Tokyo, Japan, U.S

☆ BOJ keeps ultra-loose policy, dovish guidance on outlook
▼ + stars: | 2023-09-21 | by ( Leika Kihara | Tetsushi Kajimoto | ) www.reuters.com time to read: +3 min

FILE PHOTO: Japanese national flag is hoisted atop the headquarters of Bank of Japan in Tokyo, Japan September 20, 2023. It also left unchanged an allowance band of 50 basis point set either side of the yield target, as well as a new hard cap of 1.0% adopted in July. A Reuters poll for September showed most economists predicting an end to negative interest rates in 2024. But some analysts see the yen, rather than wage growth or inflation, as the primary trigger for BOJ action. Growing prospects of higher-for-longer U.S. interest rates have pushed the yen down near the 150-per-dollar level, seen as Tokyo’s line-in-the-sand for possible currency intervention.

Persons: Issei Kato, Kazuo Ueda’s, Ueda, Haruhiko Organizations: Bank of Japan, REUTERS Locations: TOKYO, Tokyo, Japan, “, U.S

☆ Japan's central bank will keep stimulus for now as risks grow
▼ + stars: | 2023-09-19 | by ( Leika Kihara | ) www.reuters.com time to read: +3 min

A man walks in front of the headquarters of Bank of Japan in Tokyo, Japan, January 18, 2023. Many central bank policymakers prefer to hold fire until there is more clarity on whether Japan's fragile economy can weather the hit from slowing U.S. and Chinese demand, they say. "Uncertainty over the global outlook is very high, posing a huge risk to Japan's economy," one of the sources said. At the two-day meeting ending on Friday, the BOJ is widely expected to maintain its short-term interest rate target of -0.1% and that for the 10-year bond yield around 0%. It is also seen leaving unchanged guidance pledging to keep intact its bond yield control policy until inflation stably hits the bank's 2% target, the sources said.

Persons: Issei Kato, Ueda, Kazuo Ueda, Haruhiko, Leika Kihara, Sam Holmes Organizations: Bank of Japan, REUTERS, Bank of, Thomson Locations: Tokyo, Japan, TOKYO, Bank of Japan, United States

☆ What will BOJ's policy normalisation path look like?
▼ + stars: | 2023-09-12 | by ( Leika Kihara | ) www.reuters.com time to read: +4 min

Bank of Japan Governor Kazuo Ueda speaks at a group interview with media in Tokyo, Japan, May 25, 2023. But his hawkish remarks have pushed up the 10-year JGB yield to a near decade-high of 0.715% on Tuesday. It also likely sees 0.8% as a threshold it wants to defend to avoid the 10-year yield from reaching 1%. That could mean the BOJ will retain the yield cap as a precaution when it raises short-term rates, some analysts say. There are no scheduled public appearances of BOJ executives until governor Ueda's regular news conference, to be held after the BOJ's next two-day policy meeting ending on Sept. 22.

Persons: Kazuo Ueda, Kim Kyung, Kazuo Ueda's hawkish, Ueda, Haruhiko Kuroda, Ueda's, Leika Kihara, Tetsushi, Shri Navaratnam Organizations: Japan, REUTERS, Rights, Bank of Japan, Rengo, NEXT, Thomson Locations: Tokyo, Japan

☆ Analysis: BOJ's hawkish tilt suggests end to super-easy policy approaching
▼ + stars: | 2023-09-11 | by ( Leika Kihara | ) www.reuters.com time to read: +5 min

Another board member, Junko Nakagawa, laid out the conditions for ending negative rates, notably a continued improvement in household confidence. "When we see many people share prospects that wages will keep rising, we may be able to exit (negative rates)." Less than half expect negative rates to end in 2024. There seems to be no consensus within the BOJ board, however, on when or how the bank would dismantle Kuroda's complex policy framework. Ueda said the BOJ could end negative rates if it believed that inflation would sustainably hold above the target.

Persons: Kazuo Ueda, Kim Kyung, Ueda, Tamura, Haruhiko Kuroda, Naoki Tamura, Kuroda, Mari Iwashita, Hajime Takata, Junko Nakagawa, Shinichi Uchida, Leika, Sam Holmes Organizations: Japan, REUTERS, Bank of Japan, Daiwa Securities, Reuters, Thomson Locations: Tokyo, Japan, TOKYO, U.S

☆ BOJ policymaker calls for keeping ultra-easy policy, sets high bar on exit
▼ + stars: | 2023-09-07 | by ( Leika Kihara | ) www.reuters.com time to read: +3 min

As a result, it was hard to say when inflation could hit the bank's 2% inflation target in a sustainable manner, she said. "But we're not at a stage where we can judge that Japan has achieved our price target in a stable, sustainable fashion." The BOJ has defined sustainable inflation as price rises driven not by rising raw material costs, but strong domestic demand accompanied by continued wage increases. But she laid out in detail the conditions for ending negative rates. "When we see many people share prospects that wages will keep rising, we may be able to exit (negative rates)," she added.

Persons: Androniki, Nakagawa, Bank of Japan policymaker Junko Nakagawa, Haruhiko Kuroda, We're, Kazuo Ueda, Leika Kihara, Tom Hogue, Kim Coghill, Emelia Organizations: REUTERS, Bank of Japan, Thomson Locations: Japan, Tokyo, KOCHI, Kochi

☆ BOJ policymaker sees shift in Japan's deflationary mindset
▼ + stars: | 2023-09-06 | by ( Leika Kihara | ) www.reuters.com time to read: +3 min

Policymaker Takata stressed the need to maintain ultra-loose monetary policy for the time being, as slowing global growth was heightening uncertainty on whether the Bank of Japan's (BOJ) 2% inflation target was sustainably achievable. In an earlier speech, he said he believe Japan's economy was "finally seeing early signs" of achieving the 2% target. Two other BOJ board members earlier gave diverging views on how soon the central bank should consider scaling back its radical stimulus. Japan's core inflation hit 3.1% in July, exceeding the BOJ's 2% target for the 16th straight month. BOJ officials have said the central bank must keep interest rates ultra-low until robust domestic demand and sustained wage growth replace rising import costs as key drivers of inflation.

Persons: Androniki, Takata, Hajime Takata, Policymaker Takata, Haruhiko Kuroda, Leika Kihara, Tetsushi Kajimoto, Takahiko Wada, Tom Hogue, Lincoln, John Stonestreet Organizations: REUTERS, Bank of Japan's, CHINA IMPACT, Thomson Locations: Japan, Tokyo, TOKYO, China, CHINA

☆ BOJ policymaker sees signs of change in Japan's deflationary mindset
▼ + stars: | 2023-09-06 | by ( Leika Kihara | ) www.reuters.com time to read: +2 min

An office employee walks in front of the bank of Japan building in Tokyo, Japan, April 7, 2023. Takata stressed the need to maintain ultra-loose monetary policy for the time being, as slowing global growth heightens uncertainty on whether Japan can sustainably achieve the Bank of Japan's (BOJ) 2% inflation target. "Personally, I believe Japan's economy is finally seeing early signs of achieving the BOJ's 2% inflation target," Takata said in a speech. The remarks follow those of two other BOJ board members, who gave diverging views on how soon the central bank should consider scaling back its radical stimulus. BOJ officials have said the central bank must keep interest rates ultra-low until robust domestic demand and sustained wage growth replace rising import costs as key drivers of inflation.

Persons: Androniki, Takata, Hajime Takata, Haruhiko Kuroda, Leika Kihara, Tom Hogue Organizations: REUTERS, of Japan's, Thomson Locations: Japan, Tokyo, TOKYO, Lincoln

☆ Reaching 2% inflation goal necessary for BOJ easy policy exit, says ex-board member Kataoka
▼ + stars: | 2023-09-04 | by ( Divya Chowdhury | ) www.reuters.com time to read: +2 min

MUMBAI, Sept 4 (Reuters) - The Bank of Japan (BOJ) will be able to gradually shift away from its easy monetary policy only after ensuring its 2% inflation goal has been sustainably achieved, former board member Goushi Kataoka said on Monday. Kataoka expected the Spring 2024 wage negotiations to be key for the BOJ's inflation mission, Kataoka, currently chief economist at PwC Japan, told the Reuters Global Markets Forum. Once it begins exiting policy, Kataoka expects the BOJ to first remove the peg on the 10-year Japanese government bond (JGB) yield, then exit its negative interest rate policy, and finally scrap the YCC policy. "Allowing the guide rate to effectively go as low as 1% would not be possible until the 2% (inflation) target is achieved," Kataoka said. "I'm worried about the stance of Kishida cabinet," he said, describing the previous administrations' tax hikes in 2014 and 2019 as undermining the Kuroda's bold monetary policy experiment.

Persons: Goushi Kataoka, Kataoka, Haruhiko Kuroda, BOJ, I'm, Divya Chowdhury, Savio Shetty, Anisha, Christina Fincher Organizations: Bank of Japan, Reuters Global Markets, Thomson Locations: MUMBAI, Mumbai, Bengaluru

New Governor of Bank of Japan Kazuo Ueda meets Japanese Prime Minister Fumio Kishida at prime minister?s official residence in Tokyo, Japan, April 10, 2023. The discussions took place in the wake of the dollar's recent ascent above 145 yen, a level that in September 2022 triggered Japan's first yen-buying operation since 1998. "There wasn't anything in particular discussed today," Ueda told reporters after the meeting, when asked whether the two held talks on recent exchange-rate volatility. Ueda also said he explained to Kishida the Bank of Japan's decision last month to loosen its grip on long-term interest rates. It was the second such meeting since Ueda assumed the top BOJ post in April.

Persons: Bank of Japan Kazuo Ueda, Fumio Kishida, Kimimasa, Ueda Yen, Kazuo Ueda, Japan's, Ueda, Haruhiko, Shunichi Suzuki, Tetsushi Kajimoto, Satoshi Sugiyama, Chang, Ran Kim, Edmund Klamann Organizations: Bank of Japan, REUTERS Acquire, Ueda, Bank of, Soaring U.S, Treasury, Thomson Locations: Tokyo, Japan, TOKYO

☆ Insight: BOJ makes bold shift as yen risks grow too big to ignore
▼ + stars: | 2023-08-03 | by ( Leika Kihara | ) www.reuters.com time to read: +9 min

The BOJ's decision shook markets on Friday and contrasted sharply with Ueda's more cautious comments in recent months about the dangers of retreating too quickly from accommodative Kuroda-era policies. "There's also a small but probable risk of inflation overshooting in Japan, which gave the BOJ reason to act." NEW PRIORITIESThe BOJ's policy decision last week signalled to investors that it would now allow the 10-year government bond yield to move closer to 1% before it intervenes. 'BIT BY BIT'The shift in thinking gained momentum at the BOJ's June policy meeting, but not enough to turn the tide. It was a test case, or a preliminary exercise, toward future policy normalisation," said former BOJ board member Takahide Kiuchi.

Persons: Issei Kato, Kazuo Ueda, Haruhiko Kuroda, Fumio, accommodative Kuroda, Ueda, YCC, There's, Hirokazu Matsuno, Seiji Adachi, Asahi Noguchi, Ryozo Himino, Shinichi Uchida, Uchida, Masato Kanda, Kanda, Takahide, Leika Kihara, Takaya Yamaguchi, Takahiko Wada, Kentaro Sugiyama, Yoshifumi, Sam Holmes Organizations: Bank of Japan, REUTERS, TOKYO, Bank, Ueda, Reuters, BIT, Asahi, Nikkei, Thomson Locations: Tokyo, Japan

☆ Some at Bank of Japan baulked at ex-chief Kuroda's 'bazooka' stimulus, 2013 meeting minutes show
▼ + stars: | 2023-07-31 | by ( Leika Kihara | ) www.reuters.com time to read: +3 min

[1/2] Bank of Japan (BOJ) Governor Haruhiko Kuroda speaks during a news conference after attending the Monetary Policy Meeting at BOJ headquarters in Tokyo, Japan January 18, 2023, in this photo released by Kyodo. TOKYO, July 31 (Reuters) - Some Bank of Japan (BOJ) policymakers baulked at former chief Haruhiko Kuroda's idea of deploying a "bazooka" massive stimulus a decade ago, unconvinced central banks had the power to jolt public perceptions, accounts of the meeting released on Monday showed. Former banker Koji Ishida said he would propose reviewing the stimulus programme if no tangible results were seen one year into its launch, the minutes showed. Since then, the BOJ has capped long-term borrowing costs at about zero and has pledged to maintain ultra-low interest rates until its 2% inflation target is sustainably met and accompanied by wage growth. After serving two, five-year terms, Kuroda stepped down from the top BOJ post in March.

Persons: Haruhiko Kuroda, baulked, Haruhiko, Shinzo Abe, Kuroda, Masaaki Shirakawa, Hiroshi Nakaso, Takahide Kiuchi, Takehiro Sato, Sato, Koji Ishida, Leika Kihara, Jamie Freed Organizations: Bank of Japan, Kyodo ., Thomson Locations: Tokyo, Japan, Kyodo . TOKYO

☆ Investors manoeuvre, warily, for long-shot BOJ policy move
▼ + stars: | 2023-07-27 | by ( Kevin Buckland | ) www.reuters.com time to read: +5 min

SLOWLY, STEADILYBOJ sources say the central bank is leaning towards keeping its yield control policy unchanged as policymakers wait for data to affirm wages and inflation will keep rising. The benchmark 10-year JGB yield also retreated to 0.445% from as high as 0.485%. "We don't short the JGB market. In part, it's an expensive thing to do - as you know, the Bank of Japan owns 110% of the 10-year JGB market," he said. "Nobody's calling for them to hike aggressively, just bringing some function back to the JGB market, allowing themselves to step away because the data has given them an opportunity to do so.

Persons: Jimmy Lim, Lim, Kazuo Ueda, Nigel Foo, Haruhiko Kuroda, Jim Leaviss, Leaviss, Michael Michaelides, Ales Koutny, James Athey, Athey, Kevin Buckland, Ankur Banerjee, Summer Zhen, Alun John, Divya Chowdhury, Harry Robertson, Vidya Ranganathan, Edmund Klamann Organizations: Bank of Japan, Management, ING, Investors, G Investments, Vanguard, Thomson Locations: TOKYO, Singapore, FSI, abrdn

☆ Japan's top financial diplomat signals chance of BOJ policy tweaks
▼ + stars: | 2023-07-21 | by ( Tetsushi Kajimoto | ) www.reuters.com time to read: +2 min

TOKYO, July 21 (Reuters) - Japan's top financial diplomat on Friday suggested the central bank may tweak its approach to monetary stimulus at its next policy meeting, due to "signs of changes" in corporate behaviour on wage growth and price rises. In rare remarks on monetary policy, Masato Kanda, vice finance minister for international affairs, said he expects the Bank of Japan (BOJ) to make a judgment on policy by analysing the conditions and outlook for prices at every review. "Various expectations and speculations are spreading about the possibility of some kind of tweak to monetary policy," he said. The BOJ, under Governor Kazuo Ueda's predecessor Haruhiko Kuroda, launched an unprecedented round of monetary stimulus in 2013, pledging to inflate the economy to meet a 2% inflation target in two years. The BOJ is leaning towards keeping its yield control policy unchanged at next week's meeting, five sources familiar with its thinking said, as policymakers prefer to scrutinise more data to ensure wages and inflation keep rising.

Persons: Masato Kanda, Kanda's, Kanda, Kazuo Ueda's, Haruhiko Kuroda, Tetsushi Kajimoto, Leika Kihara, Satoshi Sugiyama, Andrew Heavens, Miral Fahmy, Sharon Singleton Organizations: Bank of Japan, Reuters, Thomson Locations: TOKYO

That yen hoard has mostly been held as cash with the aim of ploughing into Japanese bonds when yields eventually turn higher. "We're all waiting for the end of YCC so we can buy JGBs," said a Japanese pension fund manager who requested anonymity as he is not authorized to speak to media. Japanese banks have ploughed money into overseas bonds, but insurance firms and pension funds have kept their powder dry. MARKETS WONT BLINKSuch is the positioning and inertia among long term Japanese investors that analysts expect markets to barely blink even if the BOJ plays for time this week. Lifers and pension funds say they have very little exposure to Japanese government bonds, so a surprise policy change won't hurt them either.

Persons: Androniki, Haruhiko Kuroda, Kazuo Ueda, Bart Wakabayashi, Hirofumi Suzuki, Suzuki, Kevin Buckland, Ankur Banerjee, Vidya Ranganathan Organizations: REUTERS, Bank of, Japan, Nippon Life Insurance, Sumitomo Life Insurance, Insurance, State, Thomson Locations: Japan, Tokyo, TOKYO, SINGAPORE, YCC, Singapore

☆ Japan’s economic scars might blind it to inflation
▼ + stars: | 2023-06-13 | by ( Pete Sweeney | Thomson Reuters | Asia Economics Editor Pete Sweeney Joined Reuters Breakingviews In Hong Kong In September Previously He Served As Reuters' Chief Correspondent For China Economy | ) www.reuters.com time to read: +8 min

Investors worry about market ructions if Ueda hikes rates now but there is another risk: that he waits too long. Reuters GraphicsUeda’s inaction – and the domestic markets’ positive response – have bought him time to focus on evaluating macroeconomic fundamentals, particularly inflation. The country only emerged from a decades-long deflationary rut relatively recently, so local economists, executives and consumers are unused to worrying about consumer prices rising too fast. The government’s latest draft of its long-term economic plan, seen by Reuters on June 2, remains focused on eradicating Japan's “long-held deflationary mindset”. "We expect inflation to quite clearly slow below 2%" toward the middle of the current fiscal year, Ueda told parliament.

Persons: Kazuo Ueda, Haruhiko Kuroda, Ueda, ’, –, Richard Koo, Shinzo Abe, Francesco Guerrera, Katrina Hamlin Organizations: Reuters, Bank of Japan, Nikkei, Nasdaq, Bank for International, Toyota, Toshiba, Black Monday, Japan Inc, International Monetary Fund, of, Thomson Locations: TOKYO, Japan, United States, U.S, Great, China, Europe, Germany, Italy, of Japan’s

☆ BOJ's Ueda flags shift in corporate pricing, upward inflation bias
▼ + stars: | 2023-06-09 | by ( Leika Kihara | ) www.reuters.com time to read: +2 min

However, he stressed anew the central bank's resolve to keep monetary policy ultra-loose, to ensure companies raise wages enough to more than offset the burden on households from rising inflation. "There's still some distance to sustainably and stably achieve our 2% inflation target. As such, we will patiently maintain our monetary easing policy," Ueda told parliament. By supporting the economy, the central bank aims to generate a positive cycle in which inflation-adjusted wages will start increasing, he added. The central bank will scrutinise various data in producing fresh quarterly inflation forecasts in July, he added.

Persons: Ueda, Kazuo Ueda, There's, Leika Kihara, Christopher Cushing, Sam Holmes, Sonali Paul Organizations: Bank of Japan, Thomson Locations: Ueda TOKYO

☆ Analysis: Trauma of Japan's deflation battle keeps BOJ wary of policy shift
▼ + stars: | 2023-06-08 | by ( Leika Kihara | ) www.reuters.com time to read: +5 min

Having taken part in Japan's battle with deflation as BOJ board member from 1998 to 2005, Ueda knows all too well the danger of a premature exit from ultra-loose policy. Wary of a wobbly recovery, he opposed the BOJ's decision in 2000 to raise short-term rates to 0.25% from zero. On the surface, conditions for phasing out a portion of the BOJ's massive stimulus appear to be falling in shape. To be sure, Ueda has left scope to tweak YCC in case inflation continues to overshoot the BOJ's forecasts. In a group interview last month, Ueda said the BOJ could tweak YCC "if the balance between the benefit and cost of our policy shifts."

Persons: Ueda, Kazuo Ueda, Haruhiko Kuroda, Leika Kihara, Sam Holmes Organizations: REUTERS, Bank of Japan, Companies, Thomson Locations: Japan, Tokyo, TOKYO, U.S, China

☆ BOJ's Ueda keeps free hand, says no time frame for achieving price goal
▼ + stars: | 2023-06-02 | by ( Leika Kihara | ) www.reuters.com time to read: +3 min

The BOJ's target remained elusive until last year, when supply constraints and a spike in commodity costs caused by the COVID-19 pandemic and the war in Ukraine drove up Japan's core consumer inflation near 4%. "The time it takes for the impact of monetary policy to appear on the economy could move around a lot depending on circumstances. We therefore do not have any time frame in mind," Ueda said on Friday. Given it will take more time to achieve our price target, we will maintain the easy policy," he said, when asked by an opposition lawmaker on the likelihood of selling the BOJ's holdings. "Given uncertainty over the outlook, clarifying a set time frame for achieving our price target could have unexpected impact on financial markets," Ueda said.

Persons: Kazuo Ueda, Haruhiko Kuroda, Ueda, We'll, Leika Kihara, Chang, Ran Kim, Shri Navaratnam, Kim Coghill, Simon Cameron, Moore Organizations: Bank of Japan, Monetary, Thomson Locations: TOKYO, Ukraine

☆ Bank of Japan debated risk of inflation overshoot in March
▼ + stars: | 2023-05-08 | by ( Leika Kihara | ) www.reuters.com time to read: +2 min

A few of the nine-member board also said they saw some "positive signs" emerging in Japan that suggest the economy was making progress towards achieving the BOJ's 2% target, the minutes of the March 9-10 meeting showed. The board debated how companies were continuing to hike prices to pass on rising raw material costs, and price increases broadening to services, the minutes showed. While some saw positive signs emerging on the price front, many members said there was "extremely high" uncertainty over Japan's economic outlook that warranted keeping monetary policy ultra-loose, the minutes showed. Another member said any debate of a policy shift must be made cautiously as a reversal of ultra-loose policy would have wide-ranging effects on the public, the minutes showed. The March meeting was the final one chaired by Haruhiko Kuroda, who retired as governor in April and was succeeded by Kazuo Ueda.

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