TOKYO- Bank of Japan policymakers discussed the pace of raising interest rates further after deciding to hike short-term interest rates to the highest in 17 years, minutes of their January meeting showed on Tuesday.
“Some members shared the recognition that real interest rates were expected to remain significantly negative even if the BOJ decided to raise the policy interest rate at this meeting, and that accommodative financial conditions would be maintained,” the minutes said.
One of those members pointed out that the rate hike at the meeting would rather be an adjustment in the degree of monetary accommodation under accommodative financial conditions.
Members agreed that as real interest rates were at significantly low levels, it would be appropriate that the BOJ continue to tighten policy if the outlook for economic activity and prices was realized, the minutes showed.
At the January meeting, the BOJ raised its short-term policy target by a quarter point to 0.5 percent, its highest since the 2008 global financial crisis, and revised up its price forecasts in a show of confidence that rising wages will keep inflation stable around its 2 percent target.
The move followed last year’s decision to exit a decade-long massive stimulus in March and a rate hike to 0.25 percent in July.
