BoJ’s Takata says central bank need to consider a broad range of options on monetary policy response

Bank of Japan (BoJ) board member Hajime Takata said on Wednesday that the central bank needs a different response from conventional semi-annual rate hike pace. 

Key quotes

2026 marks a regime change, needs a different response as rate hikes are becoming a global trend on the back of economic growth, as well as AI-linked investment.

BoJ needs a different response from the conventional semiannual rate hike pace. 

BoJ needs to consider a broad range of options, not just a 0.25% rate hike each time. 

Need a more nimble approach with rate hikes. 

Neutral rates could diverse from levels calculated based on conventional analysis.

As a central bank, won't comment on benchmark JGB yield hitting 3%. 

We will monitor bond market situations carefully, though we don't believe Japan is an exceptional case. 

It's not a foregone conclusion that the next hike will be 0.25%. 

Rate hike pace should be assessed at every meeting. Generally speaking, consecutive rate hikes could be a possibility. 

Market reaction

At the time of writing, the USD/JPY pair is up 0.10% on the day at 160.35.