Analysis: The Bank of Japan has been vigilant about the rise in inflation since June and is unlikely to raise interest rates this year.

On August 5, Jin10 reported that the minutes of the June monetary policy meeting of the Bank of Japan showed concerns about inflation, with many committee members believing that the inflation outlook would exceed expectations, but there is significant uncertainty. Therefore, the debate over whether inflation is temporary may continue until July. The Bank of Japan has raised its inflation outlook in July, although Governor Kazuo Ueda's hawkish stance has weakened. Ueda emphasized that the pace of price increases will slow down starting next year, which may be the reason he maintains a hawkish stance but with reduced hawkish tendencies. The US and Japan completed trade agreement negotiations in July, but the economic impact is still under review. The summary of opinions from the monetary policy committee to be released later this week may provide an assessment in this regard. In conclusion, after Ueda's less hawkish speech last week, the Bank of Japan may not raise interest rates this year.