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BoJ's Masu says the central bank is closely watching FX market moves and their impact on the economy and prices, also noted that appropriate and timely rate hike is needed

The BoJ's Masu indicates a vigilant stance towards FX movements and their implications for Japan's economy and inflation, suggesting a potential shift towards normalization of monetary policy with appropriate rate hikes.

Newsquawk StaffPublished On the live feed at , 20 minutes before this page
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BoJ's Masu says the central bank is closely watching FX market moves and their impact on the economy and prices, also noted that appropriate and timely rate hike is needed

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Says:

  • BoJ will raise rates if the economy and prices are in line with the BoJ's outlook.
  • Cause of inflation also warrants close attention, in terms of whether inflation is truly caused by supply-side factors alone or by a combination of both demand- and supply-side factors.
  • Real interest rate remains at a significantly negative level in Japan.
  • Convinced that continuing with further policy interest rate hikes will be needed to complete the normalisation of monetary policy in Japan.
Context

His emphasis on the necessity of addressing both demand and supply-side influences on inflation signals a more complex inflation outlook, which could impact market expectations for future monetary policy adjustments. Overall, this could suggest a hawkish tilt if inflation pressures evolve as anticipated.

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