BOJ policymaker Takata: It is currently hard to determine the desirable pace of rate hikes

BOJ policymaker Takata has expressed the difficulty in determining the pace of interest rate hikes. He stated that he does not believe the BOJ is currently behind the curve in addressing inflation risks, but the future pace of hikes will depend on economic and market developments. While there is a neutral stance from Takata, BOJ Governor Ueda has hinted at significant meetings in March and April. Market participants are currently pricing in an 87% chance of no policy change at the March 19 meeting, while a 54% chance of a 25 basis point hike is foreseen for the April 28 meeting. The outcome of spring wage negotiations is expected to play a pivotal role in shaping the BOJ's policy direction. Moreover, Takata pointed out that the internal debate at the BOJ could shift with the departure of current members Noguchi and Nakagawa, who will be replaced by Asada and Sato, likely leading to a more dovish stance aligned with government goals. This changing dynamic suggests that the BOJ must approach future rate decisions with caution.