Bank of Japan Governor Ueda said the central bank has been raising rates so far based on the view that keeping rates too low for too long, when the economy and prices are recovering, risks creating economic excesses and could force rapid rate hikes later.
- He added that the rate hikes have been focused on underlying inflation, which is gradually moving toward the 2% target.
- Ueda noted that uncertainty surrounding both domestic and overseas economies is increasing due to U.S. tariffs.
- The BOJ is carefully analysing how the tariffs could affect Japan’s economy and prices through various channels.
- He also pointed out that there remains uncertainty around how U.S. tariff policy will unfold, and said the BOJ wants to closely monitor developments.
This article was written by Eamonn Sheridan at www.forexlive.com.