Headline: Adviser to PM Takaichi Urges BOJ to Hold Off on December Rate Hike
Introduction: Japan’s monetary policy debate is heating up as a newly appointed government adviser cautions the Bank of Japan against raising interest rates in December. With large-scale fiscal stimulus in motion, he argues patience would better support the country’s growth strategy.
Takuji Aida, chief Japan economist at Credit Agricole and a recent appointee to Prime Minister Sanae Takaichi’s flagship economic panel, warned that tightening policy next month would be a risky move. He said a December rate increase could work against the government’s efforts to stimulate demand through substantial public spending.
Aida indicated that a rate adjustment might be more appropriate in January, provided the economic outlook points to solid momentum heading into fiscal 2026. His comments highlight a preference for synchronizing monetary policy with fiscal expansion, signaling that the new advisory team is leaning toward a pro-growth, data-driven approach as the BOJ assesses its next steps.
Key Points: – Takuji Aida advises the Bank of Japan to avoid a December interest rate hike. – He says tightening now could undermine the government’s large-scale stimulus. – January is viewed as a more plausible window for a move, if growth forecasts strengthen. – Aida serves on Prime Minister Takaichi’s new economic strategy panel. – The stance signals preference for policy coordination to support Japan’s recovery.
