BOJ Governor Ueda Signals Inflation Nearing Target, Keeping December Rate Hike in Play

Bank of Japan Governor Kazuo Ueda stated that underlying inflation is nearing the central bank's 2% target, keeping prospects for a December interest rate hike firmly on the table. Following previous rate hikes in June and September, financial conditions remain accommodative while policymakers assess prior tightening. The central bank may formally indicate in its upcoming October quarterly outlook that inflation has hit its target. Financial markets currently price in an 86% probability that the BOJ will hold rates steady in October, alongside an estimated 64% chance of another interest rate hike by December.