The authorities of the Bank of Japan were divided in March on when the Central Bank should raise interest rates again, as the uncertainty derived from US tariff policies increased, they showed the minutes of their meeting on Thursday.
“The downward risks derived from US policies had quickly intensified and, depending on the future evolution of their tariff policy, it was very possible that these risks even had a significant negative impact on the real economy of Japan,” said a member, according to the minutes.
The member said that therefore the BOJ “would have to be particularly cautious when considering the time of the next rate increase.”
Another member said that, even with greater uncertainty, the Bank of Japan was not always obliged to apply monetary policy with excessive caution. The Bank of Japan “could face a situation in which I should act with decision,” he added.
Another member said that the BOJ should take into account the inflation expectations of companies and homes, the risks of prices and progress in salary increases when making political decisions at the next meeting.
At the meeting of March 18 and 19, the Bank of Japan held the rates at 0.5 percent. Governor Kazuo Ueda warned about the growing world economic uncertainty.
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