BOJ’s Ueda Faces Political Challenge in Raising Rates

Tokyo, Oct. 10 (Jiji Press)–Bank of Japan Governor Kazuo Ueda faces a major challenge in raising interest rates after Sanae Takaichi, who supports continued monetary easing, was elected leader of the ruling Liberal Democratic Party earlier this month.

Since taking over as governor of the central bank on April 9, 2023, Ueda has pushed to normalize monetary policy after years of aggressive easing. He has reached the halfway point of his five-year term.

“We’ve paved the way for an exit from the large-scale easing to some extent,” Ueda told a press conference in Osaka, a city in western Japan, on Oct. 3.

The BOJ ended its negative interest rate policy in March 2024, putting an end to the easing campaign pursued by Haruhiko Kuroda, Ueda’s immediate predecessor.

In July that year, the BOJ raised its policy rate to 0.25 pct, followed by another increase to 0.5 pct in January this year. In September, the central bank voted to start unloading its holdings of exchange-traded funds.

[Copyright The Jiji Press, Ltd.]