BOJ Urged to Raise Rates Above 2%

Takehiko Nakao, a former vice finance minister for international affairs until March 2013, has called on the Bank of Japan to raise its benchmark interest rate at every meeting. This goal is to take the rate above 2% to narrow the rate differential with the US and ease pressure on the yen.

Nakao pointed out that real interest rates are still negative in Japan even after the policy rate was raised to 1%. In contrast, other countries have positive real interest rates.

The Bank of Japan's current benchmark interest rate is at a record low, and Nakao believes raising it would help stabilize the yen and improve investor confidence. However, there is no mention of any specific opposition or cautionary views from other experts in the source.