Bank of Japan decides on 30 October with its rate at 1.25%, a new Outlook Report and Tokyo inflation at 2.7%

The Bank of Japan holds a Monetary Policy Meeting on 29 and 30 October 2026, with the decision and the quarterly Outlook for Economic Activity and Prices published on 30 October. The policy rate is 1.25%, after the increase from 1.00% on 18 September took effect on 24 September (report). The figures below are those known on 5 October.

What the board said in September

The Summary of Opinions from the September meeting showed members divided over pace more than direction. One said that if signs of an upward deviation in prices are observed, the Bank "will need to accelerate the pace of rate hikes"; another said underlying inflation was not accelerating at a speed that could leave the Bank behind the curve, "so there is no need to take hasty action." One said policy had entered a new phase, with the aim now to keep underlying inflation from exceeding 2% (report). The government's representatives asked the Bank to examine the cumulative effects of past increases carefully.

The data since

• Tokyo core CPI rose to 2.7% in September from 1.8%, partly on local base effects (report). National CPI for September, published on 23 October (week ahead), is the next national reading; the national core rate was 1.7% in August (report)
• The Tankan put large manufacturers' sentiment at +24 in September, with firms forecasting +21 for December, and capital spending plans up 7.6% for fiscal 2026
• The yen has been under pressure from the gap to US rates, and Japan and the United States intervened together on 31 July (report). The Fed's decision comes two days earlier (preview)

What to look at

• The decision, and any dissent
• The Outlook Report's forecasts for core inflation and growth, and the language on when underlying inflation reaches 2%
• The press conference, where the Governor addresses the pace of further increases and the exchange rate
• Tokyo's October CPI, published the same morning

What it means for the yen

The Bank's guidance has been that it will keep raising the rate in line with economic and price developments. For USD/JPY, the new forecasts and the tone on the pace matter more than a quarter-point move (carry trade explained).

What happens next

The Summary of Opinions from this meeting is due on 10 November and the minutes of the September meeting on 5 November. The next meeting is on 17–18 December.