A leading Japanese economist has reversed his long-held view. He now urges the Bank of Japan to raise interest rates without delay. This change could reshape the nation's economic plans under Prime Minister Sanae Takaichi.
Takuji Aida, an advisor to Prime Minister Sanae Takaichi, once urged patience on rate hikes. On September 7 in Tokyo he issued a new note saying the Bank of Japan can wait no longer. His earlier warnings focused on protecting fragile growth and avoiding any sudden shock to businesses and households.
Japan has relied on ultra-low rates for years to fight deflation and support spending. Recent data show rising prices and stronger wage growth, yet many households still feel squeezed. Aida sits on the prime minister's key growth panel and his shift carries weight in policy circles.
The move raises questions about how soon rates will rise and how high they may go. Markets now watch for signs that the long reflation effort is nearing its end. Officials must balance steady growth against the risk of higher borrowing costs for families and firms.
Original Author: Jake Scott | Source: FEE
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