BoJ Koeda: Need to adjust monetary policy appropriately in light of upside price risks
Bank of Japan (BoJ) Board Member Junko Koeda said during the European trading session on Thursday that monetary conditions have remained accommodative and we need adjust them to contain upside inflation risks.
Comments
Basic stance on neutral rate is that we have to consider in a range.
Monetary environment has been accommodative.
No specific pace of rate hikes in mind.
Seeing neutral rate significantly above 1%.
Underlying inflation is stabilizing around 2%.
Pace of passing costs to prices has been in line with BoJ's main scenario in July.
Will adjust monetary policy so that underlaying inflation won't exceed 2%.
Sept rate hike reflected additional data showing resilience of the economy.
Assessment of financial conditions should be comprehensive, taking into not just neutral rate but also funding demand.
Market reaction
No major impact is seen on the Japanese Yen (JPY), following remarks from BoJ's Koeda. As of writing, USD/JPY trades 0.25% lower to near 157.90.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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