BOJ should avoid premature rate hike, says ex-deputy governor

• Japan must raise neutral rate of interest via fiscal policy, growth strategy
• If Japan’s neutral rate rises as a result of fiscal policy, it would be natural for BOJ to hike rates
• But for now BOJ should avoid premature rate hike, excessive monetary tightening
• Sanaenomics carries over elements of Abenomics but focuses more on strengthening supply side of the economy

Well, take his comments here with a pinch of salt as he is part of the government panel recruited by Japan prime minister Takaichi. So, the bias in his remarks and narrative is to side with the government and to try and speak against the intentions by the BOJ to hike rates later this week.

This article was written by Justin Low at investinglive.com.