Bank of Japan Governor Kuroda: No preset path for rate hikes, but the economy is on track.

On Thursday, the Bank of Japan announced that it would maintain interest rates unchanged, but reiterated that if the economic outlook remains as expected, it will continue to push for interest rate hikes, shifting investors' focus to the possibility of a hike as early as December. Although the Bank of Japan largely maintained its long-term economic forecasts, it detailed the overseas risks that could impact Japan's economic recovery, underscoring its focus on economic growth issues. Excerpts from Bank of Japan Governor Kuroda's remarks at the post-meeting press conference: Trade Policy Impact "The economic outlook faces various risks. In particular, the impact of trade policies on overseas economies and price trends still have high uncertainty." Economic Forecast "At present, our economic forecast has not changed significantly compared to the report released in July. The likelihood of our base forecast becoming a reality has slightly increased." Wages and Prices "We hope to spend more time carefully observing wage and price developments. There will be more data in the future that can reflect how companies respond to the pressure of a 15% tariff, as well as wage-setting plans including next year. We need to confirm if wages and prices will gradually rise in sync." Inflation "Food inflation is gradually slowing down, while core inflation is rising mildly. The current economic trends align with our base scenario, therefore we believe we are not behind the economic situation. We will continue to monitor the trend of core inflation, as well as closely track if food price increases (if sustained) will pose upside or downside risks to the price outlook." Interest Rate Hikes related "We have not preconceived any position regarding the timing and feasibility of interest rate hikes." Regarding calls from the government "We will continue to maintain close communication with the government." US Economy "The demand in the Artificial Intelligence (AI) field has exceeded expectations. The impact of tariffs seems to have been significantly delayed, but could still have a considerable impact on consumption and the overall economy... Even if tariffs affect US consumption, it will be a gradual process. Therefore, the risks facing the US economy may be lower than what we expected in April. However, the impact of the US government shutdown on the economy may surpass expectations, so we will continue to closely monitor relevant developments." Response to Kuroda's call for interest rate hikes "I cannot directly comment on this. We will formulate economic and price outlooks, and adjust the degree of monetary easing policy when the likelihood of achieving the forecasts increases." Domestic Consumption "Currently, wages are rising moderately, but prices of major goods such as food are high, putting pressure on non-durable goods consumption, the service industry, and dining out demand. However, consumer confidence is gradually rebounding, so we expect consumption to remain resilient. As for future trends, it will depend on the results of next year's wage negotiations." Neutral interest rate "Unfortunately, due to various uncertainties, we are currently unable to narrow down the estimated range of Japan's neutral interest rate." Decision to maintain interest rates unchanged today "Although the uncertainties related to trade policies and their impact on overseas economies and the US economy may have somewhat diminished, the risks still exist. In the short term, we hope to assess next year's wage negotiation direction through further data observation." Yen exchange rate fluctuations "I cannot comment on short-term fluctuations in exchange rates. Stable fluctuations in exchange rates based on economic fundamentals are ideal. We will always monitor the impact of exchange rate fluctuations on the economy and prices, including the driving factors behind these fluctuations."