Bank of Japan Governor Kazuo Ueda: Monetary policy has entered a new phase and will continue to raise interest rates

According to Jinshi Data, Bank of Japan Governor Kazuo Ueda stated that Japan's core inflation is close to 2%, marking a policy shift, and the central bank's policy has entered a new phase where inflation cannot be allowed to rise further. Due to core inflation being close to 2% and the financial environment remaining accommodative, the Bank of Japan will continue to raise interest rates and adjust its monetary easing policy. The central bank will discuss whether to adjust the assessment of "core inflation close to 2%" at the upcoming meeting.

Kazuo Ueda mentioned that the situation in the Middle East, demand for artificial intelligence, and exchange rates will influence the timing of interest rate hikes. The central bank has been monitoring the impact of the weakening yen and the Middle East situation on inflation. He also stated that it is difficult to make a clear statement about Japan's neutral interest rate, and the stability of 2% inflation is becoming increasingly important. The central bank will focus on consolidating the 2% inflation target. Additionally, Ueda noted that the main takeaway from this week's meeting (including the G20) was the communication with other policymakers regarding the impact of the Middle East conflict and demand for artificial intelligence on the global and Japanese economy, and there was nothing heard that deviated from the Bank of Japan's fundamental views. He exchanged opinions with Federal Reserve Chairman Waller but will not disclose specific details; since the meeting in Asheville, he has not contacted U.S. Treasury Secretary Yellen.