BoJ Governor Ueda (post-policy presser) says April price behaviour is a factor to mull a rate hike. The impact of any sales tax abolition would be hard to gauge.

• Hearings suggest that wages are impacting prices more than previously.
• Not necessarily waiting for data on the impact of the December hike.
• Difficult to quantify the neutral rate.

• Important for the government to secure market confidence, via a commitment to fiscal health.

BoJ Governor Ueda's remarks signal that the central bank is actively considering the implications of recent price behavior, particularly in relation to wage growth, which could influence a future rate hike. His acknowledgment that quantifying the neutral rate and the effects of fiscal policy remains challenging indicates ongoing uncertainty in Japan's economic trajectory. Overall, this points to a cautious approach from the BoJ, with potential implications for JPY and fixed income markets as any policy adjustment will need to balance inflation pressures with economic stability.