Probability of BOJ Rate Hike in December Rises to 64% as Ueda Signals Major Policy Shift

　　 Bank of Japan Governor Kazuo Ueda has issued the clearest signal to date, hinting that the central bank may raise its benchmark interest rate this month. He emphasized that any rate increase would merely be an adjustment to the degree of monetary easing and that the BOJ would make an appropriate decision on whether to take action.

　　 Ueda stated that the BOJ will examine domestic and international economic conditions, inflation trends, and financial market developments to weigh the pros and cons of raising the policy rate before making an appropriate decision.

　　 According to the overnight index swap market, traders now see about a 64% probability of the BOJ raising interest rates when its policy meeting concludes on December 19. The likelihood of action by the end of January next year has risen to 90%.

　　 Following Ueda's remarks, the yen strengthened slightly against the U.S. dollar. Prior to his comments, market speculation about a BOJ rate hike had intensified, with the two-year Japanese government bond yield rising to its highest level since 2008.