Political maker urges Boj Dovish to stop interest rates on uncertainty in the US tariff

Kihara and Chang-Ran Kim Kim

Tokyo (Reuters) -Bank of Japan must stop interest rates today.

Nakamura, known as the most members of the Board of Directors, said that the central bank should direct the monetary policy “caution” with the due attention to the high uncertainty about the American commercial policy that can affect the activity of companies and the family.

“The Japanese economy faces downside pressure,” Nakamura said in a speech, as the American customs tariff, including in the basic auto sector, can seriously hurt corporate profits, “Nakamura said in a speech.

“The rush to raise interest rates when growth slows, it can limit consumption and investment with delay,” said Nakamura, the former CEO of the company whose term ends at the Board of Directors at the end of June.

The Japanese economy data showed for the first time a year and quickly faster than expected, the data showed for March quarter on Friday, which emphasized the fragile nature to restore it now under the threat of US President Donald Trump’s policies.

Nakamura said that although capitalist spending is still firm, uncertainty about the US tariff policy already urges Japanese companies to postpone spending plans or follow the waiting and vision approach.

He added that the American customs tariff can also lead to a “vicious cycle of demand and prices”, which requires BOJ to take carefully in the rise in future prices.

The United States imposed a 10 % tariff on all countries with the exception of Canada, Mexico and China, as well as high customs tariff rates for many major commercial partners, including Japan, which faces a 24 % tariff rate starting from July unless he is able to negotiate with an agreement with Washington.

The United States also imposed 25 % of car fees on cars, steel and aluminum, which led to a major blow to the Japanese economy, which depends heavily on car exports to the United States.

The World Trade War to which the American tariff also touched on the complexity of BOJ’s decision on how long and to what extent could lead to raising interest rates.

Fears of the global slowdown caused by Trump forced BOJ to reduce her growth expectations at the May 30 Politics meeting, and question her view that continuous high wages will support consumption and the broader economy.

A survey of Reuters showed that most economists are now expecting to keep interest rates fixed during the month of September to assess the effects of the American customs tariff, although the slight majority still sees at least an increase of 25 points at the end of the year.

(Voyka by Lika Chihara and Chair: