RBI Cuts Repo Rate to 5.25% as Inflation Cools and Growth Outlook Strengthens 
BOK Expected to Hold Rates at 2.50% as Housing and Currency Pressures Persist 
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BOJ Governor Ueda Highlights Uncertainty Over Future Interest Rate Hikes 
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RBA Signals Possible Rate Implications as Inflation Proves More Persistent 
Gold Prices Steady as Markets Await Key U.S. Data and Expected Fed Rate Cut 
European Stocks Rise as Markets Await Key U.S. Inflation Data 
UK Raises Deposit Protection Limit to £120,000 to Strengthen Saver Confidence 
Fed Officials Split as Powell Weighs December Interest Rate Cut 
Japan’s Nikkei Drops as Markets Await Key U.S. Inflation Data 
Kazakhstan Central Bank Holds Interest Rate at 18% as Inflation Pressures Persist 
U.S. tariffs under President Donald Trump may derail Japan’s monetary tightening, with former Bank of Japan (BOJ) board member Takako Masai warning that interest rate hikes are unlikely amid rising trade uncertainty. Masai, who maintains ties with current policymakers, said the BOJ will likely hold off on further rate increases through 2026 due to expected damage to Japan’s exports and broader economy.
Masai highlighted U.S. auto tariffs as particularly harmful, given the automobile sector's key role in Japan’s economy. She noted that the economic impact could intensify by 2026, urging caution in monetary policy amid global disruptions.
The BOJ raised rates to 0.5% in January under Governor Kazuo Ueda, marking the end of a prolonged stimulus era. However, analysts and Masai now see limited room for additional hikes as Japan struggles in trade talks with Washington and faces weaker export demand.
Despite inflation staying above the BOJ’s 2% target for over three years—driven largely by rising food and energy costs—Masai argued the inflation is not sustainable and likely to moderate with slowing global demand. She called for the BOJ to commit to low real interest rates to support structural reforms and domestic demand growth.
The central bank’s cautious tone was reinforced on May 1 when it cut growth forecasts, signaling potential delays to its tightening path. While Ueda has not ruled out further hikes, he remains flexible amid economic headwinds.
Masai warned that if Japan experiences a severe shock, the BOJ may need to revive aggressive easing tools, even expanding its already large balance sheet. “That’s the nature of policymaking,” she said, emphasizing the need for a supportive monetary stance amid global trade risks.
