BOJ Ignores Calls for Faster Rate Hikes Amid Inflation Risks

The Bank of Japan (BOJ) met on July 30-31 and decided to keep interest rates unchanged, despite growing concerns about inflation. This decision was made after calls for faster rate increases were heard from some members of the BOJ Policy Board.

Just a few months prior, in June, the BOJ had increased its policy rate to 1.25%. This latest decision marks the shortest gap between rate hikes during Governor Kazuo Ueda's tenure.

One key question on the minds of many BOJ Policy Board members at the July meeting was whether underlying inflation would settle around 2%.