BOJ debated need for more rate hikes even after December move, summary shows

TOKYO, Dec 29 : Bank of Japan policymakers debated the need to continue raising interest rates with some calling for “timely” action to curb future inflationary pressure, a summary of opinions at their policy meeting in December ‌showed on Monday.

At the December 18-19 ‌meeting, the BOJ raised its policy rate to a 30-year high of 0.75 per cent from 0.5 per cent, taking another landmark step in ending decades of huge monetary support and near-zero borrowing costs.

The summary showed ‍many board members seeing the need for further increases to the BOJ’s policy rate, which remained significantly negative in inflation-adjusted terms.

“There is still considerable distance ​to levels deemed neutral,” ‌one opinion showed, adding the BOJ should raise rates at a pace of once ​every few months for the time being.

Another opinion said ⁠the weak yen and ‌rising long-term interest rates were due in ​part to the BOJ’s policy rate being too low relative to inflation.

“Raising the policy ‍rate in a timely manner could curb future ⁠inflationary pressure and help hold down long-term interest rates,” ​the second opinion ‌showed.