Overview
- The BOJ raised its policy rate from about 0.5% to roughly 0.75%, the highest level since September 1995.
- Ueda said the bank will keep raising rates as economic and price conditions improve, noting expectations for next spring’s pay increases to hold at this year’s levels.
- Minutes from the October policy meeting show several board members viewed the current rate as below neutral and backed a plan for gradual increases.
- Reporting indicates long-term yields have risen, with newly issued 10-year JGBs at a 26-year, 10-month high, while the yen has stayed weak despite the hike.
- Private estimates suggest a small average household benefit from higher rates but losses for indebted households and profit pressure on firms, especially highly leveraged SMEs.