BOJ's slow, dovish revamp casts doubt over long-term rate-hike plans

BOJ's slow, dovish revamp casts doubt over long-term rate-hike plans amid growing political pressure on the Bank of Japan to slow its interest-rate increases. Reuters reports that Prime Minister Sanae Takaichi and allies are pushing to restore “dovish” policymakers to the BOJ, which could shift the bank’s long-term direction even if near-term hikes are unlikely to be affected. Tokyo, June 30: the administration stayed quiet as the BOJ prepared its June decision to raise rates to a 31-year high of 1%, while Economy Minister Minoru Kiuchi urged the BOJ to consider growth initiatives in future decisions. In a July economic blueprint, the government is expected to call for monetary policy aligned with efforts to boost growth and keep borrowing costs low. Personnel changes, including votes against the June hike by appointee Toichiro Asada and another presumed-looser appointment, may test BOJ independence, especially as Governor Kazuo Ueda’s term ends in early 2028.