Marcel Thieliant of KITU Macro said in his comments that the Bank of Japan seems to be tightening and may raise interest rates to a neutral level next year. The Asia Pacific director said, “The attached outlook report is too tight. We insist on our non-consensus view that the central bank will raise interest rates to 2% by the end of next year.” Thieliant pointed out that the Bank of Japan Committee listed a series of upward inflationary pressures, including pressure from rising crude oil and semiconductor prices and weakening yen. Furthermore, the Bank of Japan now believes that “basic inflation” may rise above its 2% target, which indicates a more serious level of concern, Thieliant added.

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