BoJ's Uchida: Rate Hikes to Continue If Economy and Prices Align With Forecast

BoJ’s Uchida Signals Potential for More Rate Hikes If Economic Outlook Holds

Bank of Japan (BoJ) Deputy Governor Shinichi Uchida stated on Tuesday that the central bank is prepared to continue raising interest rates, provided that Japan's economy and inflation evolve in line with the bank’s current forecasts.

“If the economy and prices move as we expect, we will keep raising interest rates,” Uchida said, reaffirming the BoJ’s commitment to a gradual policy normalization path.

Uchida also highlighted significant uncertainty surrounding global trade policies, which he described as "extremely high," posing a risk to Japan’s recovery momentum. He noted that while Japan’s inflation had shown signs of slowing recently, underlying price pressures are expected to re-accelerate in the near term.

The Deputy Governor also acknowledged the recent rise in prices and its negative impact on household consumption, suggesting that the central bank is carefully balancing inflation control with economic stability.

Market Reaction
Following Uchida’s comments, the USD/JPY pair remained under slight pressure, trading close to 145.00 and down about 0.38% on the day at the time of writing.

Investors are now watching closely for further signals from t