BoJ Governor Kazuo Ueda said the board will actively debate the “pros and cons” of raising interest rates at its December 18–19 meeting. He emphasized that the bank is now focused on whether firms’ “active wage-setting behavior” will persist, calling it a key determinant of the timing of the next hike.
Ueda noted that even with an increase, real interest rates would remain deeply negative, meaning policy would still be accommodative—more akin to “easing off the accelerator” than “applying the brakes.”
On the Yen, Ueda said Monday that further weakness is likely to push consumer inflation higher, a development that requires close monitoring when setting policy.
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