BOJ Governor Ueda pledges rate hike, but warns of US tariff impact
From Yahoo Finance: 2025-04-24 18:12:00
Bank of Japan Governor Kazuo Ueda stated the central bank will raise interest rates if underlying inflation approaches the 2% target. Ueda emphasized the importance of monitoring factors like U.S. tariffs’ impact on the economy. He noted global policymakers share similar concerns about tariff effects on their economies.
Ueda plans to consider insights from discussions with global policymakers when evaluating Japan’s economy and setting monetary policy. The BOJ aims to gradually raise interest rates if inflation trends towards the 2% target. Ueda emphasized the importance of analyzing incoming data objectively for policy decisions.
Ahead of the BOJ’s policy meeting, Ueda hinted at maintaining interest rates at 0.5% and revising growth projections downwards. The central bank previously raised rates to 0.5% last year, anticipating sustainable achievement of the 2% inflation target. However, Trump’s tariffs have complicated future rate hike decisions.
The BOJ is likely to delay additional rate hikes due to uncertainty from U.S. tariffs, impacting growth and inflation. The IMF predicts Japan’s economy to grow 0.6% in 2025, revised down from earlier estimates, mainly due to the effects of U.S. tariffs. This uncertainty poses challenges for the BOJ’s monetary policy decisions.
Read more: BOJ’s Ueda keeps rate-hike pledge but warns of US tariff impact