BOJ Likely to Pursue Further Rate Hikes This Year

Tokyo, Jan. 5 (Jiji Press)--The Bank of Japan will likely seek to raise interest rates further this year after bringing its policy rate target to a 30-year high above 0.5 pct in late 2025.

The central bank is increasingly confident that a virtuous cycle in which both wages and prices rise will take hold in Japan.

The BOJ is expected to start full-fledged talks on implementing an additional rate hike if solid wage increases are confirmed in this year's "shunto" labor-management negotiations in spring, informed sources said.

In an address late last year, BOJ Governor Kazuo Ueda showed the central bank's intention to raise interest rates further in accordance with improvements in the economy and prices, saying, "The bank believes that adjusting the degree of monetary accommodation as appropriate will lead to smoothly achieving the (BOJ's 2 pct) price stability target and to long-term (economic) growth."

The BOJ put its massive monetary easing to an end in March 2024 by lifting its negative interest rate policy, and conducted rate hikes in stages since then.

[Copyright The Jiji Press, Ltd.]