Connect with us

Hi, what are you looking for?

Economy

Japan PM Ishiba says he won’t intervene in BOJ’s rate policy

By Leika Kihara

TOKYO (Reuters) – Japanese Prime Minister Shigeru Ishiba said on Saturday he would not intervene in monetary policy affairs, as the central bank is mandated to achieve price stability.

“It’s important to avoid vocally intervening” in monetary policy affairs, or appear as if he was doing so, Ishiba said in a news conference gathering leaders of major parties ahead of the Oct. 27 general election.

“Whatever the government has to say, the Bank of Japan makes an individual decision on policy,” Ishiba said. “I believe the BOJ’s governor and staff have a strong sense of responsibility over achieving price stability.”

Ishiba also said strength in consumption is key to achieving a sustained exit from deflation, calling for the need for measures to boost real wages.

The former defence minister became Japan’s prime minister on Oct. 1 after winning the ruling party’s leadership race.

A day after assuming the role, Ishiba stunned markets by saying the economy was not ready for further interest rate hikes, an apparent about-face from his previous support for the BOJ unwinding decades of extreme monetary stimulus.

The surprisingly blunt remarks pushed the yen lower against the dollar and cast fresh doubts over how aggressive the BOJ would be in raising rates.

It is historically rare for the country’s leader to comment directly on the BOJ’s interest rate policy in public, as it would infringe upon the central bank’s independence – stipulated by law – in setting monetary policy.

The BOJ ended negative interest rates in March and raised the short-term benchmark to 0.25% in July on the view Japan was making progress towards durably achieving its 2% inflation target.

Governor Kazuo Ueda has signalled the bank’s readiness to keep raising interest rates if economic and price developments move in line with its forecast.

While politics is unlikely to derail the longer-term case for rate hikes, analysts say uncertainty on Ishiba’s stance on monetary policy and the outcome of the Oct. 27 election could complicate the BOJ’s decision on how soon to raise borrowing costs.

This post appeared first on investing.com

You May Also Like

Investing

Fisker (NYSE: FSR) stock price has been one of the best-performing electric vehicle (EV) stocks this week even as Tesla slumped. The shares jumped...

Investing

Newmont (NYSE: NEM) reported mixed financial results even as the price of gold approached its all-time high. In all, the company’s earnings per share...

Investing

The Fox Corporation (NASDAQ: FOX) stock price has been under pressure as investors come to terms with the abrupt firing of Tucker Carlson. The...

Investing

NatWest (LON: NWG) share price rose sharply, helped by the strong results from Barclays. The stock jumped to a high of 274.8p, which was...




Disclaimer: Oldamericanbroker.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the-company.


Copyright © 2024 Oldamericanbroker.com