"Japan Likely to Keep Base Interest Rate Unchanged Next Week"

"Deciding Based on Wage and Price Trends Is Not Too Late"

The Bank of Japan, Japan's central bank, is expected to keep its benchmark interest rate unchanged.

The Nihon Keizai Shimbun (Nikkei) and Yomiuri Shimbun reported on the 14th that the Bank of Japan will maintain the short-term policy interest rate, its benchmark rate, at 0.25% at the Monetary Policy Meeting scheduled for the 18th and 19th.

Kazuo Ueaga, Governor of the Bank of Japan, is speaking at the Tokyo House of Representatives Committee on Finance and Financial Affairs. Photo by Yonhap News

Nikkei stated, "The Bank of Japan intends to carefully assess wages and prices," adding, "There is a possibility that the rate hike will be postponed at this month's meeting."

Yomiuri Shimbun reported, "There is a growing view that it is necessary to carefully assess wage increase movements during next year's spring labor negotiations (Chuntu)," and "The Bank of Japan's decision on a rate hike may be delayed until after January next year." It also added, "In the financial market, opinions that the rate hike decision will be postponed this month are becoming stronger."

Kyodo News also explained, "Within the Bank of Japan, there is a cautious stance toward a rate hike this month, with a growing consensus that there is no need to rush the increase."

Until recently, the Japanese financial market expected the Bank of Japan to raise rates at the upcoming Monetary Policy Meeting. The Bank of Japan ended its negative interest rate policy by raising the benchmark rate for the first time in 17 years in March. Then, at the July meeting, it raised the rate from 0?0.1% to 0.25%.