Overview
- The Bank of Japan raised its policy rate to about 0.75% at the Dec. 18–19 meeting with a unanimous vote by the nine-member board.
- The published summary of 'main opinions' shows multiple calls to keep adjusting the degree of easing, with one member proposing hikes roughly once every few months.
- One policymaker described Japan's rate, given current inflation, as among the lowest worldwide, underscoring the case for additional tightening.
- Several members linked yen weakness and higher long-term yields to a policy rate that is too low relative to inflation.
- The rationale for December's move included reduced uncertainty over U.S. high-tariff policy and a higher likelihood of solid wage gains in next spring's labor talks, and the yen firmed slightly after the opinions were released following earlier weakness post-press conference.