Ueda Kazuo's speech made no mention of consecutive rate hikes; is the Bank of Japan's decision to hold steady in October a foregone conclusion?

Notice that Bank of Japan Governor Kazuo Ueda has shown almost no indication of any intention to challenge the market's current bearish bets on a second consecutive rate hike by the central bank this month, merely reiterating the bank's longstanding policy stance. Speaking in a brief address in Tokyo on Tuesday, Ueda said, "We intend to continue raising the policy rate and adjust the degree of monetary easing in line with changes in economic activity, prices, and financial conditions." The governor said, "We will consider the timing and pace of these adjustments while assessing risks and the likelihood that the baseline outlook for the economy and prices will be realized." The remarks come as economists widely expect the Bank of Japan to keep policy unchanged when its next monetary policy board meeting concludes on October 30. By reiterating the central bank's policy stance and economic views, Ueda did little to dispel those expectations, while preserving room for a rate hike after October. Pricing in overnight index swaps shows investors see about a 12% chance of a rate hike this month, down from as high as 40% early last week. When the December meeting is taken into account, the current probability of a hike surges to about 90%. The governor reiterated the view he expressed after the central bank raised its benchmark rate last month, emphasizing the need to prevent inflation from overshooting the target. Ueda said, "We believe it is becoming increasingly important to stabilize underlying inflation at around 2%, to ensure that the risk of inflation exceeding the 2% price stability target does not materialize and adversely affect the economy." The Bank of Japan raised its benchmark rate on September 18, just three months after its June hike, marking the shortest interval between rate increases since 1990. At a news conference after the meeting, Ueda said the central bank's policy phase had shifted to focusing on stabilizing the trend in prices, rather than pushing the price trend toward the 2% target as it had for the past 13 years. Ueda said it was necessary to closely monitor risks from the Middle East conflict, AI-related demand, and exchange-rate fluctuations. He added that underlying inflation could rise above the target. In the summary of opinions from the September meeting, a government officialmost likely Minister of State for Economic and Fiscal Policy Minoru Kiharasaid the government hoped the Bank of Japan would carefully assess the impact of the rate hikes implemented so far, signaling caution about further increases.