The post BOJ signals more rate hikes ahead as policy still far from neutral appeared on BitcoinEthereumNews.com.

Some members of the Bank of Japan’s board have flagged the possibility of additional rate hikes after noting that the nation’s real interest rate remains very low despite a recent increase in the benchmark rate. Emphasizing the seriousness of the situation, one of the nine board members pointed out that Japan’s real policy interest rate is currently the lowest in the world. This observation came during a two-day board meeting. In response, the members suggested that the BOJ should consider adjusting its monetary policy to address the effects of currency movements on prices. BOJ members outline the challenges faced in achieving a neutral policy rate Sources pointed out that the key takeaways from the two-day meeting clearly indicate that the Bank of Japan (BOJ) is still working on a neutral policy rate. To support this claim, one member of the bank’s board clarified that, “We can say there is still a significant distance to reach the neutral interest rate.”  After the member made this statement, the Governor of the BOJ, Kazuo Ueda, commented that they find it challenging to determine this level. Ueda made these remarks during a press conference just after the December 19 finding. At this particular moment, reports noted that a study carried out by the bank indicated that the neutral rate lies within a wide range of approximately 1% to 2.5%.  The study also demonstrated that some members concurred with Ueda’s argument on the neutral rate and acknowledged the difficulty in identifying it. This situation prompted several members to present some suitable solutions to address the matter.  One member proposed that it is prudent for the BOJ to embrace a flexible approach as it interprets this level. Another member argued that instead of focusing on a certain level, the bank should be flexible in making decisions…

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Filed under: News - @ December 29, 2025 4:20 am