Governor Kazuo Ueda said the Bank of Japan will maintain its trajectory of raising policy rates based on the evolution of price and financial conditions. Following a policy meeting on Oct 30, Ueda stated that while underlying inflation is now “generally consistent” with the central bank’s 2% target, he will not officially declare that the goal has been met until the level is stably and sustainably maintained.
The BOJ kept its benchmark interest rate at 1.25% in an 8-1 vote, dismissing a proposal from board member Hajime Takata to increase the target to 1.5%. In its latest economic outlook, the bank projected core inflation to reach 2.5% for FY2026 and 2.6% for FY2027, noting that price risks remain tilted to the upside due to high crude oil costs, semiconductor expenses and yen depreciation.