News

BoJ Maintains Tightening Bias Amid Middle East Risks
Bank of Japan Deputy Governor Ryozo Himino said the central bank remains committed to further interest-rate hikes, though the timing and pace will depend on how the Middle East conflict affects Japan’s economy and inflation. Speaking before a parliamentary committee on Tuesday, Himino stressed that Japan’s real interest rates remain “at extremely low levels,” adding that the BoJ will “continue to raise the policy rate and adjust the degree of monetary accommodation in accordance with economic, price, and financial developments.” However, he avoided signaling when the next rate increase could occur, noting that policymakers are closely monitoring the economic and price impact of geopolitical tensions in the Middle East. Himino also said the central bank aims to maintain market credibility through appropriate monetary policy management and the stable achievement of its inflation target.
Published on 2026-05-26

BoJ Remains on Track for Further Rate Hikes
Policymakers at the Bank of Japan stayed cautious about the uncertain Middle East situation at their April meeting, though several members still saw scope for near-term interest rate hikes. One official said there was “no need to take hasty action,” but argued the central bank should raise rates soon unless there are clear signs of an economic slowdown. Another member said “it is quite possible” the board could hike rates from the next meeting onward, even if uncertainty surrounding the Gulf conflict persists, while a third warned the central bank may need to accelerate tightening “without hesitation” if upside inflation risks intensify. Some members stressed that while downside risks to growth and upside risks to prices could both rise, policy should focus on preventing inflation from overshooting and hurting the economy later on. At the April 27–28 meeting, the BoJ kept its policy rate unchanged at 0.75% but raised inflation forecasts due to soaring oil prices linked to the Iran war.
Published on 2026-05-12

BoJ Signals Openness to Further Rate Hikes
Policymakers at the Bank of Japan stayed cautious about the uncertain Middle East situation at their April meeting, though several members still saw scope for near-term interest rate hikes. One official said there was “no need to take hasty action,” but argued the central bank should raise rates soon unless there are clear signs of an economic slowdown. Another member said “it is quite possible” the board could hike rates from the next meeting onward, even if uncertainty surrounding the Gulf conflict persists, while a third warned the central bank may need to accelerate tightening “without hesitation” if upside inflation risks intensify. Some members stressed that while downside risks to growth and upside risks to prices could both rise, policy should focus on preventing inflation from overshooting and hurting the economy later on. At the April 27–28 meeting, the BoJ kept its policy rate unchanged at 0.75% but raised inflation forecasts due to soaring oil prices linked to the Iran war.
Published on 2026-05-12

BoJ Flags Energy-Driven Inflation Risk in March Minutes
Many Bank of Japan board members saw a need for further rate hikes should the Iran war-driven energy shock persist and fuel broader inflation pressures, minutes from the March meeting showed. While policymakers agreed temporary supply disruptions from Middle East tensions could be overlooked, they cautioned that a prolonged rise in energy costs risked second-round effects on expectations and underlying prices. One member urged raising rates “without long intervals,” while another pressed for tightening “without hesitation” if the economy avoided major damage. The BoJ left its short-term policy rate unchanged at 0.75% at the March 18–19 meeting, the first after U.S.–Israeli strikes on Iran. At its April gathering, the central bank again held steady, though a more hawkish divide underscored growing concern over mounting inflationary pressures from higher fuel costs and lingering price gains.
Published on 2026-05-07

BoJ Flags Energy-Driven Inflation Risk in March Minutes
Many Bank of Japan board members saw a need for further rate hikes should the Iran war-driven energy shock persist and fuel broader inflation pressures, minutes from the March meeting showed. While policymakers agreed temporary supply disruptions from Middle East tensions could be overlooked, they cautioned that a prolonged rise in energy costs risked second-round effects on expectations and underlying prices. One member urged raising rates “without long intervals,” while another pressed for tightening “without hesitation” if the economy avoided major damage. The BoJ left its short-term policy rate unchanged at 0.75% at the March 18–19 meeting, the first after U.S.–Israeli strikes on Iran. At its April gathering, the bank again held steady, though a more hawkish divide underscored concern over mounting inflationary pressures from higher fuel costs and persistent price gains.
Published on 2026-05-07

BoJ Flags Energy-Driven Inflation Risk in March Minutes
Many Bank of Japan board members saw a need for further rate hikes should the Iran war-driven energy shock persist and fuel broader inflation pressures, minutes from the March meeting showed. While policymakers agreed temporary supply disruptions from Middle East tensions could be overlooked, they cautioned that a prolonged rise in energy costs risked second-round effects on expectations and underlying prices. One member urged raising rates “without long intervals,” while another pressed for tightening “without hesitation” if the economy avoided major damage. The BoJ left its short-term policy rate unchanged at 0.75% at the March 18–19 meeting, the first after U.S.–Israeli strikes on Iran. At its April gathering, the bank again held steady, though a more hawkish divide underscored concern over mounting inflationary pressures from higher fuel costs and persistent price gains.
Published on 2026-05-07

BoJ Holds Rates as Expected
The Bank of Japan left its key short-term interest rate unchanged at 0.75% at its April 2026 meeting, keeping borrowing costs at their highest level since September 1995. The move was widely anticipated by markets and was approved by a 6–3 vote.
Published on 2026-04-28

BoJ Holds Rates, Raises Inflation Forecast
The Bank of Japan left its short-term policy rate unchanged at 0.75% at its April 2026 meeting, keeping borrowing costs at their highest level since September 1995. The widely expected decision, approved by a 6–3 vote, came amid uncertainty over the war in Iran and surging energy prices. Board members Hajime Takata, Naoki Tamura, and Junko Nakagawa dissented from the move, calling for a hike to 1.0%. In its quarterly outlook, the board raised its 2026 core inflation forecast to 2.8% from 1.9%, citing higher crude oil costs likely to lift energy and goods prices. Policymakers, however, cut the 2026 growth forecast to 0.5% from 1%, reflecting weaker domestic momentum. By contrast, the 2025 GDP projection was nudged up to 1.0% from 0.9%, supported by a trade deal with Washington and Tokyo’s sizable stimulus package.
Published on 2026-04-28

BoJ Holds Rates, Raises Inflation Forecast
The Bank of Japan kept its short-term policy rate unchanged at 0.75% at its April 2026 meeting, leaving borrowing costs at their highest level since September 1995. The widely expected decision passed by a 6–3 vote, amid uncertainty over the Iran conflict and surging energy prices. Board members Hajime Takata, Naoki Tamura, and Junko Nakagawa dissented, calling for a hike to 1.0%. In its quarterly outlook, the central bank raised its FY2026 core inflation forecast to 2.8% from 1.9%, citing higher crude oil prices likely to push up energy and goods costs. At the same time, policymakers cut the FY2026 growth forecast to 0.5% from 1.0%, reflecting softer domestic momentum. Still, the economy is expected to expand moderately, underpinned by government support measures, accommodative financial conditions, and resilient corporate profits. The FY2025 GDP projection was slightly lifted to 1.0% from 0.9%, lifted by last year’s trade deal with Washington.
Published on 2026-04-28

BoJ Holds Rates as Expected
The Bank of Japan left its key short-term interest rate unchanged at 0.75% at its April 2026 meeting, keeping borrowing costs at their highest level since September 1995. The move was widely anticipated by markets and was approved by a 6–3 vote. In its quarterly outlook, the board slightly raised its FY2025 GDP growth forecast to 1.0% from 0.9%, citing support from a trade deal with Washington and Tokyo’s sizable stimulus package. However, the FY2026 growth projection was cut to 0.5% from 1.0%, reflecting the drag from the Middle East conflict, which is expected to weigh on corporate profits and erode households’ real income through a deterioration in the terms of trade. Meanwhile, the core consumer inflation forecast for FY2026 was revised higher to 2.8% from 1.9%, as rising crude oil prices are likely to lift costs, particularly for energy and goods.
Published on 2026-04-28

BoJ Holds Rates, Raises Inflation Forecast
The Bank of Japan left its short-term policy rate unchanged at 0.75% at its April 2026 meeting, keeping borrowing costs at their highest level since September 1995. The widely expected decision, approved by a 6–3 vote, came amid uncertainty over the war in Iran and surging energy prices. Board members Hajime Takata, Naoki Tamura, and Junko Nakagawa dissented from Tuesday's move, all calling for a hike to 1.0%. In its quarterly outlook, the board raised its 2026 core inflation forecast to 2.8% from 1.9%, citing higher crude oil costs likely to lift energy and goods prices. Policymakers, however, cut the 2026 growth forecast to 0.5% from 1%, reflecting weaker domestic momentum. By contrast, the 2025 GDP projection was nudged up to 1.0% from 0.9%, supported by a trade deal with Washington and Tokyo’s sizable stimulus package.
Published on 2026-04-28

BoJ Holds Rates, Raises Inflation Forecast
The Bank of Japan kept its short-term policy rate unchanged at 0.75% at its April 2026 meeting, leaving borrowing costs at their highest level since September 1995. The widely expected decision passed by a 6–3 vote, amid uncertainty over the Iran conflict and surging energy prices. Board members Hajime Takata, Naoki Tamura, and Junko Nakagawa dissented, calling for a hike to 1.0%. In its quarterly outlook, the central bank raised its FY2026 core inflation outlook to 2.8% from 1.9%, citing higher crude oil prices that likely push up energy and goods costs. At the same time, policymakers trimmed the FY2026 growth forecast to 0.5% from 1.0%, reflecting softer domestic momentum. Still, the overall economy is expected to expand moderately, underpinned by government support measures, accommodative financial conditions, and resilient corporate profits. The FY2025 GDP projection was slightly lifted to 1.0% from 0.9%, backed by last year’s trade deal with Washington.
Published on 2026-04-28

BoJ Holds Rates, Raises Inflation Forecast
The Bank of Japan left its short-term policy rate unchanged at 0.75% at its April 2026 meeting, keeping borrowing costs at their highest level since September 1995. The widely expected decision, approved by a 6–3 vote, came amid uncertainty over the war in Iran and surging energy prices. In its quarterly outlook, the board raised its 2026 core inflation forecast to 2.8% from 1.9%, citing higher crude oil costs likely to lift energy and goods prices. Policymakers, however, cut the 2026 growth forecast to 0.5% from 1%, reflecting weaker domestic momentum. By contrast, the 2025 GDP projection was nudged up to 1.0% from 0.9%, supported by a trade deal with Washington and Tokyo’s sizable stimulus package.
Published on 2026-04-28

BoJ Holds Rates, Raises Inflation Forecast
The Bank of Japan kept its short-term policy rate unchanged at 0.75% at its April 2026 meeting, leaving borrowing costs at their highest since September 1995. The widely expected decision passed by a 6–3 vote, amid uncertainty over the Iran conflict and surging energy prices. Board members Hajime Takata, Naoki Tamura, and Junko Nakagawa dissented, calling for a hike to 1.0%. In its quarterly outlook, the central bank raised its FY2026 core inflation forecast to 2.8% from 1.9%, citing higher crude oil prices likely to push up energy and goods costs. At the same time, policymakers cut the FY2026 growth forecast to 0.5% from 1.0%, reflecting softer domestic momentum. Still, the economy is expected to expand moderately, underpinned by government support measures, accommodative financial conditions, and resilient corporate profits. The FY2025 GDP projection was slightly lifted to 1.0% from 0.9%, lifted by last year’s trade deal with Washington.
Published on 2026-04-28

BoJ Holds Rates, Raises Inflation Forecast
The Bank of Japan kept its short-term policy rate unchanged at 0.75% at its April 2026 meeting, leaving borrowing costs at their highest level since September 1995. The widely expected decision passed by a 6–3 vote, amid uncertainty over the Iran conflict and surging energy prices. Board members Hajime Takata, Naoki Tamura, and Junko Nakagawa dissented, calling for a hike to 1.0%. In its quarterly outlook, the central bank raised its FY2026 core inflation outlook to 2.8% from 1.9%, citing higher crude oil prices that likely push up energy and goods costs. At the same time, policymakers trimmed the FY2026 growth forecast to 0.5% from 1.0%, reflecting softer domestic momentum. Still, the overall economy is expected to expand moderately, underpinned by government support measures, accommodative financial conditions, and resilient corporate profits. The FY2025 GDP projection was slightly lifted to 1.0% from 0.9%, underpinned by last year’s trade deal with Washington.
Published on 2026-04-28

BoJ Holds Rates, Raises Inflation Forecast
The Bank of Japan left its key short-term interest rate unchanged at 0.75% at its April 2026 meeting, keeping borrowing costs at their highest level since September 1995. The move was widely anticipated by markets and was approved by a 6–3 vote. In its quarterly outlook, the board slightly raised its FY2025 GDP growth forecast to 1.0% from 0.9%, citing support from a trade deal with Washington and Tokyo’s sizable stimulus package. However, the FY2026 growth projection was cut to 0.5% from 1.0%, reflecting the drag from the Middle East conflict, which is expected to weigh on corporate profits and erode households’ real income through a deterioration in the terms of trade. Meanwhile, the core consumer inflation forecast for FY2026 was revised higher to 2.8% from 1.9%, as rising crude oil prices are likely to lift costs, particularly for energy and goods.
Published on 2026-04-28

BoJ Holds Rates, Raises Inflation Forecast
The Bank of Japan kept its short-term policy rate unchanged at 0.75% at its April 2026 meeting, maintaining borrowing costs at their highest level since September 1995. The widely expected decision, passed by a 6–3 vote, came amid uncertainty over the Iran war and surging energy prices. Board members Hajime Takata, Naoki Tamura, and Junko Nakagawa dissented, calling for a hike to 1.0%. In its quarterly outlook, the central bank raised its 2026 core inflation forecast to 2.8% from 1.9%, citing higher crude oil costs likely to lift energy and goods prices. Meanwhile, policymakers cut the 2026 growth forecast to 0.5% from 1%, reflecting weaker domestic momentum, though the economy is still expected to grow moderately, supported by government support measures, accommodative financial conditions, and solid corporate profits. The 2025 GDP projection was nudged up to 1.0% from 0.9%, aided by last year’s trade deal with Washington.
Published on 2026-04-28

BoJ Holds Rates, Raises Inflation Forecast
The Bank of Japan kept its short-term policy rate unchanged at 0.75% at its April 2026 meeting, leaving borrowing costs at their highest level since September 1995. The widely expected decision passed by a 6–3 vote, amid uncertainty over the Iran conflict and surging energy prices. Board members Hajime Takata, Naoki Tamura, and Junko Nakagawa dissented, calling for a hike to 1.0%. In its quarterly outlook, the central bank raised its FY2026 core inflation outlook to 2.8% from 1.9%, citing higher crude oil prices that likely push up energy and goods costs. At the same time, policymakers trimmed the FY2026 growth forecast to 0.5% from 1.0%, reflecting softer domestic momentum. Still, the overall economy is expected to expand moderately, underpinned by government support measures, accommodative financial conditions, and resilient corporate profits. The FY2025 GDP projection was slightly lifted to 1.0% from 0.9%, lifted by last year’s trade deal with Washington.
Published on 2026-04-28

Japan Flags Faster Cross-Market Spillovers as Volatility Surges
Japan’s Finance Minister Satsuki Katayama said recent market turmoil has highlighted how quickly interest rates can be influenced by volatility spilling over from other markets, a dynamic she warned is becoming too significant to ignore. Katayama noted that “financial markets have seen an excessive degree of volatility since February 26, far beyond what would normally be warranted,” stressing that such instability can accelerate rate movements more than expected. The minister added that “interest-rate increases transmitted from other markets can materialise much more rapidly than we anticipate,” underscoring the speed of global financial linkages. The issue was widely recognized during a recent meeting with Group of Seven counterparts, Katayama noted, calling for a more “renewed and well-considered” policy response to manage these cross-market spillovers.
Published on 2026-04-09

BoJ Eyes Gradual Policy Shift Amid Risks
Further policy rate hikes in Japan remain appropriate as economic activity and prices improve, with monetary accommodation to be reduced gradually if the outlook holds. The Bank of Japan’s March Summary of Opinions noted that despite earlier increases, financial conditions remain loose, and investment pullbacks have largely reflected labor shortages and rising material costs rather than higher rates. Still, uncertainty from the Middle East has weighed on sentiment, prompting the board to keep rates steady at its latest meeting. Future tightening will hinge on wages, inflation, financial conditions, and geopolitical risks. Policymakers will assess whether accommodative conditions persist and how broadly wage gains and “beginning-of-period price hikes” spread. While external risks may lift prices and dampen growth, inflation is expected to trend higher. Policymakers emphasized the need to adjust policy without delay if conditions hold, while avoiding sustained inflation above 2%.
Published on 2026-03-30