BoJ's Masu Backs Rate Hike to 1.25% as U.S. Pressure Builds
Updated
Updated · Financial Times · Sep 10
BoJ's Masu Backs Rate Hike to 1.25% as U.S. Pressure Builds
3 articles · Updated · Financial Times · Sep 10
Summary
Kazuyuki Masu said the Bank of Japan must raise rates further and may need rapid hikes if inflation accelerates, arguing negative real rates should be ended quickly.
A 0.25-point increase to 1.25% is widely expected at next week's meeting, which would take the policy rate to its highest level in more than 30 years.
Scott Bessent's remarks that he had insight into BoJ plans have intensified expectations for tightening, after Washington pressed Tokyo to lift rates and support the yen.
The yen has rebounded to about 53.30 per dollar from nearly 54 in July after a $96 billion U.S.-Japan intervention, while 10-year JGB yields have climbed above 3%.
Masu's shift from a centrist to a more outspoken voice adds to signs the BoJ is accelerating normalization, with markets also watching for another move as soon as October.