Central Bank of Japan’s reaction to Trump’s return to White House
reports Mehr News Agency , Casuo Ouda , Central Bank of Japan, and The board of directors increased short -term interest rates to 3.5 percent. This increase was already predicted in the market.
The decision to raise the rate until January has been linked to the wage process and the market reaction to Donald Trump’s return to the White House. The Central Bank of Japan also considered the relative stability of global financial markets a favorable factor.
Ouda at the news conference then He said that we will adjust our policies if the forecasts are fulfilled, but it did not mention specific timing for the next move.
After this announcement, the yen was reinforced against the dollar and reached 1.2, while the 5-year-old bond returns Japan rose to 4.9 percent. The Japanese stock market also dropped by 4.9 percent.
This is the third increase in interest rates under the management of Ouda in less than a year indicating a change in monetary policies of the country Is. The Central Bank of Japan has also increased its inflationary forecasts and is likely to increase interest rates every month .
Some economists have warned that high rates of interest rates may have negative effects on the economy, especially if the yen becomes too weak and the inflationary pressures caused by imports increase.
Ouda also pointed out that the neutral interest rate, a level in which the monetary policy is neither contraction nor not Expansion is still a long time and the central bank will continue to analyze it.
However, this increases Japan’s interest rate closer to other advanced economies, allowing it to be more flexible in response to economic events in the future. At the same time, the Japanese government has not opposed the decision and considers it a factor in controlling inflation and maintaining economic stability.
