BOJ and Japanese Economy: Ideas Later.

Japan economy broadly in line with outlook since Sept. meeting: BOJ chief

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BANGKOK (Kyodo) -- Bank of Japan Governor Kazuo Ueda said Friday that Japan's economic activity has developed broadly in line with the central bank's outlook since its September policy meeting.

The governor said that the BOJ would continue to seek to raise interest rates to adjust the degree of monetary accommodation, as underlying inflation is approaching the bank's 2 percent inflation target.

Speaking to reporters in Bangkok, where he was attending Group of 20 meetings of finance ministers and central bank governors, Ueda said stabilizing inflation around 2 percent is a key policy goal for the BOJ.

He added that the BOJ would not tolerate underlying inflation rising above that level.

The BOJ has been closely monitoring the impact of the yen's weakness, Middle East tensions and AI-related developments on inflationary pressures.

"With underlying inflation nearing 2 percent and financial conditions remaining accommodative, the BOJ would continue to raise rates in response to economic and price developments," Ueda said, adding that the timing and pace would depend on market movements, exchange rates and an assessment of risks to the outlook.

The BOJ will decide at its Oct. 29-30 policy meeting whether to revise its assessment of underlying inflation based on the information available at the time.

"Economic data since the September meeting have been broadly on track for the BOJ's outlook, with no major new information to warrant a change in its forecast," he said.

Asked about the neutral interest rate, Ueda said it would be difficult to pinpoint a specific level, stressing the need to assess the cumulative effects of past rate hikes on financial conditions, the economy and prices.

Japan's top currency diplomat Atsushi Mimura, speaking alongside the BOJ governor, said the International Monetary Fund has worked for years to build more productive ties with Southeast Asian countries, including through economic surveillance and technical assistance.

The vice finance minister for international affairs described this week's annual meetings of the IMF and the World Bank as an opportunity to further strengthen those ties.

"Japan has been one of the IMF's strongest supporters of capacity-building efforts," Mimura said.

Article source:  https://mainichi.jp/english/articles/20261017/p2g/00m/0bu/003000c