“我考虑的是未来总体正常化的合适规模，以及如何最好地分配整个加息时间，”植田在华盛顿出席国际货币基金组织（IMF）和世界银行（World Bank）年度会议期间回答问题时说。“这让我一天24小时都睡不着。”Source: Jin10 Data
Author: Xiao Yanyan
Mr. Ueda stated that the correct scale of normalization for the Bank of Japan is making me sleepless 24 hours a day. He believes that excessive caution poses potential risks.
The Governor of the Bank of Japan, Kazuo Ueda, hinted that more interest rate hikes are imminent, stating that determining the appropriate scale and timing of further normalization of Japan's loose monetary policy is his top priority.
"What I am considering is the appropriate scale of overall normalization in the future, and how to best allocate the entire timing of rate hikes," Ueda said when answering questions during the annual meetings of the International Monetary Fund (IMF) and the World Bank in Washington. "This makes me unable to sleep 24 hours a day."
Ueda's remarks further indicate that the Bank of Japan is looking for the right time to raise interest rates again, with most Bank of Japan watchers expecting another rate hike early next year. The Bank of Japan Governor also stated that simply waiting may not necessarily be the correct solution, as providing cautious signals only in uncertain situations could lead to undesirable market positioning.
Ueda said, "When there is significant uncertainty, you usually want to act cautiously and step by step. But the problem is, if you proceed very, very gradually and create expectations that interest rates will stay at low levels for a long time, this may lead to accumulation of large speculative positions—which could become a problem in the future."
The yen fell 1.4% against the US dollar to 153.19 on Wednesday, hitting the weakest level since July 31. Although the Governor of the Bank of Japan was not directly asked about the yen's trend, many Bank of Japan watchers are closely watching the yen's movement, as it could be a key factor in determining the timing of another rate hike.
It is widely expected that Kuroda and his colleagues will maintain the benchmark interest rate at the next policy meeting ending on October 31. Investors will focus on whether this meeting intends to raise the current 0.25% benchmark interest rate in December or January. Kuroda stated on Wednesday that the current policy stance remains "quite accommodative".
The Bank of Japan's rate hike in July and its potential further rate hike guidance were believed to have triggered global market turbulence in early August, leading to massive unwinding of yen carry trades positions. The yen has not yet reached the around 162 38-year low set in early July, but the relatively rapid depreciation has once again raised concerns about intervention by the Japanese Ministry of Finance.
Earlier on Wednesday, Japanese Finance Minister Taro Aso declined to comment on the yen's decline during an interview with reporters.
Editor/Jeffy
