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6d ago

Japan Confirms 2% Inflation Goal as U.S. Urges BOJ to Tighten

Officials underscore the central bank’s autonomy following market moves triggered by Washington’s warning of delayed rate hikes.

Japan's Finance Minister Katsunobu Kato speaks during an interview with Reuters at the Finance Ministry in Tokyo, Japan April 17, 2025. REUTERS/Issei Kato/File Photo
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Overview

  • Economy Minister Ryosei Akazawa said the government and the BOJ are jointly committed to achieving a durable 2% inflation rate to support growth.
  • U.S. Treasury Secretary Scott Bessent described the BOJ as “behind the curve” on inflation and predicted imminent rate hikes, prompting yen appreciation and higher JGB yields.
  • Finance Minister Katsunobu Kato reiterated that specific monetary policy decisions rest solely with the central bank based on economic data.
  • Preliminary figures showed Japan’s GDP expanded by 0.3% in the second quarter, confirming a modest recovery.
  • Officials said U.S. tariffs may trim around 0.3–0.4% off real GDP and that discussions over including chip-making equipment in trade pacts have yet to be finalized.