BOJ's Ueda Caught Between Bessent and Takaichi's Competing Visions

Bank of Japan Governor Kazuo Ueda is facing pressure from two opposing forces - the US Treasury's Scott Bessent and Japanese Premier Sanae Takaichi. On one hand, Bessent was urging Ueda to accelerate monetary tightening by raising interest rates. This is exactly what happened on Friday, with the BOJ hiking interest rates for a second time in three months.

The move gives Bessent the boost he's been pushing for, but it's not without its challenges. As of September 18, Ueda now has two back-seat drivers - Bessent and Takaichi. While Bessent wants to speed up monetary policy, Takaichi is focused on promoting faster economic growth.

The BOJ's latest decision was met with dissent from Takaichi's two appointees, who voted against the rate hike. This could be a harbinger of what's to come next year when Takaichi gets to replace the most hawkish members of the current board.