Bank of Japan Governor Kazuo Ueda said that an excessive yen could pose a risk to the Japanese economy, commenting on the rise in the yen/dollar exchange rate from about 130 yen to 161 yen in July this year when he took office.
As for how much the Bank of Japan will raise interest rates in the future, Ueda said, “minus 1% to plus 0.5%” based on real interest rates.
In response, the Nikkei explained that if inflation is assumed at 2%, the interest rate is likely to be 1.2 to 2.5%.
Ueda noted that if yen weakness progresses quickly, he will respond by changing fiscal policies.
