BOJ Policymakers Urge Faster Rate Hikes Amid Inflation Risks

The Bank of Japan's case for raising interest rates has strengthened after a growing number of policymakers argued for a more forceful response to inflation risks, according to a summary of opinions at their July meeting. At least three members of the nine-member board said the BOJ could raise rates more quickly than its current pace of roughly two increases a year.

The summary's hawkish tone reinforces market expectations that the BOJ could raise rates as soon as September, following a nudge from U.S. Treasury Scott Bessent and joint intervention by Tokyo and Washington to prop up the yen.

Having just raised interest rates in June, the BOJ kept policy steady at the two-day meeting ending on July 31 but strongly signalled a near-term increase. Many policymakers saw the need to focus more on the risk of underlying inflation overshooting the BOJ's 2% target.