MNI BRIEF: Slow Rate Hikes Expected - BOJ's Noguchi
Bank of Japan board member Asahi Noguchi said on Thursday that the pace of raising the policy interest rate will be very slow as it takes considerable time for inflation to continue increasing as a trend.
Noguchi was against ending the negative interest rate and yield curve control policy simultaneously at the March meeting, he told business leaders in Saga City.
Steady services price rises and the pass-through of wage hikes to sales prices are necessary to strengthen the wage-price virtuous cycle, he added, noting the second-round inflationary pressure has not strengthened sufficiently to achieve the bank’s 2% price target.
The BOJ must maintain accommodative monetary policy not only to keep favourable labour market conditions but also to achieve its inflation target, he added.
MNI reported this week the BOJ is watching the soft yen's impact on second-round inflation. (See MNI POLICY: BOJ Concern Grows Over Yen Impact On Wages, Prices)