BoJ’s Tamura: Don't have preset idea on pace of further rate hikes

The Bank of Japan (BoJ) board member Naoki Tamura is back on the wires on Thursday, noting that “don't have a preset idea on the pace of further rate hikes,” when asked whether the BoJ could raise rates again by year-end, or March end of the current fiscal year.

Additional comments

• Unlike US and Europe, Japan's rate hikes are likely to be slow.

• Exact timing on when Japan can see short-term rates reach 1% will depend on economic, price conditions at the time.

• Data out so far show Japan's economy moving in line with forecasts made in BoJ July meeting.

• Focusing too much on whether markets are stable or not could prevent BoJ from conducting monetary policy appropriately reflecting economic, price developments.

• In long-term perspective, markets move in a way reflecting fundamentals.

• Having said that, big, rapid market volatility is undesirable.

• When markets are quite fragile, we need to set a period to ensure markets cool down.

• Cannot say now whether BoJ could raise rates by end of this year.

• Weak yen being reversed somewhat but rise in import costs seen earlier this year will likely affect consumer inflation with a lag.

• Compared to when USD/JPY was at 160, upward risk to inflation has subsided somewhat.

• BoJ must slowly raise rates in several stages, while closely watching how each rate hike affects economic activity.

Market reaction

These comments fail to move the Japanese Yen, as USD/jPY adds 0.32% on the day to trade near 142.80, as of writing.