{
  "id": 1425908,
  "title": "Bank of Japan should raise rates at every meeting, ex-currency chief says",
  "url": "https://urgent.news/2026/08/17/bank-of-japan-should-raise-rates-at-every-meeting-ex-currency-chief",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-08-17T04:47:37.000Z",
  "source": {
    "name": "The Business Times - Companies & Markets",
    "slug": "the-business-times-companies-markets",
    "url": "https://www.businesstimes.com.sg/companies-markets/banking-finance/bank-japan-should-raise-rates-every-meeting-ex-currency-chief-says"
  },
  "original_language": "en",
  "account": "Former Finance Ministry official Takehiko Nakao argues that the Bank of Japan should raise its benchmark interest rate at every meeting, with the ultimate aim of pushing the rate above 2 percent. The rationale behind this stance is to narrow the interest rate differential between Japan and the United States, thereby alleviating pressure on the yen. Nakao points out that real interest rates remain negative in Japan even after the central bank raised its policy rate to 1 percent, while they are positive across all other countries. He also suggests that Japan's policy rate could potentially reach 2.25 percent or 2.5 percent, given an inflation rate of around 2 percent. This perspective emerges as market participants closely scrutinize the timing and pace of additional BOJ rate hikes. Governor Kazuo Ueda recently indicated that there are upside risks to inflation, potentially triggering an increase as early as September. Prime Minister Sanae Takaichi's government, too, favors a near-term rate hike according to sources familiar with the matter. Current market expectations, based on overnight-indexed swaps, indicate a 79 percent probability of a rate hike at the BOJ's board meeting scheduled for September 18. There is also a growing discussion about whether the central bank could accelerate the tightening process, considering the yen's weakness and elevated bond yields. Some analysts suggest a more aggressive move, such as a 50-basis-point hike or an additional increase in December following an expected rise in either September or October. Meanwhile, the yen is currently trading at 159.09 against the US dollar, slightly stronger than the four-decade low of 163.99 reached last month, but still significantly weaker than its 10-year average of 126.09. Nakao emphasizes that while Japan could intervene to prevent further yen weakness, it also needs to raise interest rates through monetary policy. He notes that the rate differential remains a crucial factor driving the yen's \"extreme weakness.\" Nakao also highlights comments from US Treasury Secretary Scott Bessent, who has repeatedly emphasized the importance of appropriate monetary policy in addressing the yen's weakness, signaling a preference for higher interest rates over currency intervention. Nevertheless, Japan possesses ample reserves, with US$1.2 trillion in foreign currency reserves, suggesting that it still retains considerable capacity to implement further intervention if needed.",
  "summary": "Traders see a 79% chance of a hike when the BOJ’s board meet on Sept 18",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}