Economy News

Bank of Japan holds rates but says its 2% inflation goal has been reached

The Bank of Japan kept interest rates steady at its policy meeting ending on Friday 30 October, but said its inflation target has been reached. The Japan Times reports that consumer prices are now rising more than 2% a year, in a way that suggests the gains are stable and sustainable.

The statement was widely expected. On 6 October, Hong Kong's The Standard, carrying Reuters, reported that sources expected the BOJ to say underlying inflation had roughly reached 2% after the 29–30 October meeting, in a largely symbolic move. The bank had raised its key rate to a 31-year high in September, and in July it expected underlying inflation to reach target-consistent levels between October 2026 and March 2028.

The Standard also reported that a renewed slide in the yen could add pressure on the bank to act sooner.

“Inflation expectations remain elevated but not flaring up.” — a source familiar with BOJ thinking, via The Standard

How each outlet framed it

• The Japan Times — the milestone: the BOJ now judges price gains above 2% to be stable and sustainable.
• The Standard — the market reading: the signal would reinforce expectations of a December hike and show the BOJ is ready to keep raising rates at short intervals.

What we don't know yet: whether the BOJ will raise rates in December, and how a weaker yen might change its timing.