BOJ governor Ueda: We must raise rates if economic, price developments continue to improve ...Middle East

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BOJ governor Ueda: We must raise rates if economic, price developments continue to improve
Expects Japan to further progress towards 2% inflation in stable, sustainable mannerUncertainty surrounding economy, price outlook is highMust avoid returning to deflation or low inflation environmentAs Japan transitions towards sustained achievement of 2% inflation, BOJ will support the economy by keeping rates below the neutral levelBut as economic, price developments continue to improve, BOJ must raise rates accordinglyLeaving accommodative policy for too long could lead to sharp increase in interest ratesThat in turn will be negative for long-lasting economic growthIt would be desirable for BOJ to guide policy so that it does not reach zero lower bound again

here will definitely still be echoing into the new year. So, do keep that in mind when taking stock of the BOJ when markets get back on the saddle in January.

This article was written by Justin Low at www.forexlive.com.

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