Bank of Japan policymakers were divided on how soon they could raise interest rates, with some warning of the risk of renewed market volatility, a summary of opinions at the October policy meeting showed on Monday.
Many in the nine-member board highlighted the need to scrutinize market developments, particularly yen moves, in determining whether the economy can weather higher borrowing costs, the summary showed.
While the risk of a U.S. hard landing has subsided, the BOJ must spend time scrutinizing market developments ¡°as it was too early to conclude markets will restore calm,¡± one member said.
Another member said the BOJ must ¡°take time and exercise caution¡± when raising rates.
Others, however, saw the need to communicate clearly the BOJ¡¯s resolve to continue raising rates if its economic and price forecasts are met, the summary showed.
¡°The Bank should consider further rate hikes after pausing to assess developments in the U.S. economy,¡± one member was quoted as saying, adding that Japan¡¯s economy no longer needed substantial monetary support.
At the Oct. 30 to 31 meeting, the BOJ maintained ultra-low interest rates but said risks around the U.S. economy were somewhat subsiding, signaling that conditions are falling into place to raise interest rates again.
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