Bank of Japan October meeting minutes: Internal disagreements on the timing of interest rate hikes, caution against market volatility risks
The minutes of the October monetary policy meeting released on Monday show that there are differences among Bank of Japan policymakers regarding when to raise interest rates, with some warning that market volatility may re-emerge. The minutes indicate that many of the nine committee members emphasized the need to closely monitor market dynamics, particularly the yen's movements, to determine whether the Japanese economy can withstand higher borrowing costs. One member stated that although the risk of a hard landing for the U.S. economy has diminished, the Bank of Japan must take time to carefully examine market developments, "because it is still too early to conclude that the market will return to calm." Another member noted that the Bank of Japan must "proceed with caution" when raising interest rates. However, the minutes reveal that others believe it is necessary to clearly convey the Bank of Japan's determination to continue raising rates if the economy and prices meet expectations. One member stated, "The Bank of Japan should consider further rate hikes after pausing to assess the developments in the U.S. economy," adding that the Japanese economy no longer requires substantial monetary policy support. The Bank of Japan maintained its ultra-low interest rates during the meeting on October 30-31 but indicated that the risks facing the U.S. economy have lessened, suggesting that the conditions for another rate hike are maturing
According to the Zhitong Finance APP, the minutes of the October monetary policy meeting released on Monday show that there are differences among Bank of Japan policymakers regarding when to raise interest rates, with some warning that the market may experience volatility again.
The minutes indicate that many of the nine committee members emphasized the need to closely monitor market dynamics, particularly the yen's movements, to determine whether the Japanese economy can withstand higher borrowing costs.
One committee member stated that although the risk of a hard landing for the U.S. economy has diminished, the Bank of Japan must take time to carefully examine market developments, "because it is still too early to conclude that the market will return to calm."
Another committee member mentioned that the Bank of Japan must "proceed with caution" when raising interest rates.
However, the minutes reveal that others believe it is necessary to clearly communicate the Bank of Japan's determination to continue raising interest rates if the economy and prices meet expectations.
One committee member stated, "The Bank of Japan should consider further rate hikes after pausing to assess the developments in the U.S. economy," adding that the Japanese economy no longer requires substantial monetary policy support.
The Bank of Japan maintained its ultra-low interest rates during the meeting on October 30-31 but indicated that the risks facing the U.S. economy have lessened, suggesting that the conditions for another rate hike are maturing