BOJ’s Ueda Reaffirms Commitment to Loose Monetary Policy Amid Inflation Concerns

Bank of Japan (BOJ) Governor Kazuo Ueda stated on Friday that the central bank remains committed to maintaining an accommodative monetary environment to support economic growth and facilitate a sustainable rise in inflation toward the 2% target.

Speaking before Parliament, Ueda emphasized that recent inflationary pressures, driven by higher food and energy costs, are largely transitory and are expected to ease over time. His remarks come just a week after the BOJ raised its benchmark interest rate to 0.5%, the highest level in 16 years, sparking concerns over potential yen-driven market volatility.

Ueda’s comments may help alleviate fears of a sharp yen appreciation leading to broader risk aversion in global financial markets, including cryptocurrencies. However, he reiterated that the BOJ remains prepared to adjust rates further should economic conditions justify additional tightening. Analysts at ForexLive suggest another rate hike could be on the table by July.