BOJ's Shift to Inflation-Risk Rationale Signals Policy Logic Change, Economist Says on June 17

According to Sony Financial Group economist Tetsuya Inoue, Japan's central bank's decision to cite inflation upside risks as the rationale for raising rates today marks a notable shift in its policy logic. Historically, the BOJ emphasized adjusting monetary policy to achieve its 2% inflation target in a stable, sustainable manner. Inoue warns that if the BOJ lags behind developments, it could trigger a spike in long-term bond yields, further weaken the yen, and accelerate inflation.
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