The statement from members of the Japanese government today is that "the Bank of Japan should avoid raising interest rates too early and excessively adjusting monetary support." This should not change the Bank of Japan's interest rate increase action this Friday, but it will affect the subsequent pace of the Bank of Japan. Previously, we talked about the highlights of the Bank of Japan's monetary policy meeting this Friday not being this interest rate increase. Instead, it is about whether the Bank of Japan's outlook on future interest rate policy paths will change, when the next increase will be after this one, and what the future terminal interest rate will be.

Personally, I expect that after this, there will probably be just one or two more increases at most, and the intervals in between will be relatively long (half a year or even longer for another increase). The Bank of Japan's interest rate may need to stop around 1% and take a look.

The core logic is: the Bank of Japan wants to get rid of long-term negative interest rates and move towards interest rate normalization. The economic situation and the fiscal stimulus to be implemented also mean that it is difficult for them to raise interest rates to particularly high levels. The statement from members of the Japanese government today conveys this meaning.