Bank of Japan Must Act Cautiously to Avoid Disrupting Inflation Cycle

A member of the Bank of Japan, Ichigo Zeng, emphasized the need for the central bank to proceed cautiously to prevent excessive interest rate hikes from disrupting the nascent cycle of inflation and wage growth. According to Jin10, Zeng highlighted the importance of maintaining a balanced approach to monetary policy to support the ongoing economic recovery. The Bank of Japan's strategy aims to foster a stable environment for moderate inflation and wage increases, crucial for sustaining economic momentum. The central bank's cautious stance reflects concerns over potential adverse effects on the economy if interest rates are raised too aggressively.