BOJ could raise rates every quarter, ex-policymaker says

Former Bank of Japan board member Makoto Sakurai stated on Thursday that the central bank could raise interest rates every quarter to combat rising inflation. In September, the BOJ increased rates to a 31-year high of 1.25 per cent, focusing on tackling price pressures from surging fuel costs, according to Sakurai. Government data reveals Japanese crude oil import costs have surged 70 to 80 per cent since February, after the US attacked Iran, which will raise consumer inflation rates.

A weak yen and robust demand for AI-related products are also contributing to profit growth for manufacturers, fueling price pressures, Sakurai explained. He predicts consumer inflation could surpass 3 per cent by year-end, prompting the BOJ to accelerate hikes to maintain inflation below its 2 per cent target. The BOJ may revise up its inflation forecasts in the October quarterly outlook report and likely raise rates again in December, with a possible early hik in October if revisions are substantial, according to Sakurai.