TechFlow news, January 16 — According to sources, some Bank of Japan policymakers believe the possibility of an earlier-than-expected rate hike is growing, with a strong chance of tightening in April due to the yen's continued depreciation potentially exacerbating already-rising inflationary pressures. BOJ policymakers face a difficult task: raising ultra-low borrowing costs after years of maintaining them, amid global headwinds intensifying growth pressure, while Japan's economy has only just begun recovering from prolonged deflation.
The central bank raised interest rates in December to their highest level in thirty years and is expected to hold rates steady at its January meeting. However, sources said many BOJ policymakers see room for further rate hikes, with some not ruling out action in April—earlier than the market consensus, which expects tightening in the latter half of this year. Sources indicated that if sufficient evidence emerges showing Japan will sustainably achieve its 2% inflation target, certain members within the BOJ would not rule out moving sooner. (Golden News)
