The Bank of Japan adjusts its communication methods to prepare the market for a possible interest rate hike as soon as December

The Bank of Japan is preparing markets for a possible rate rise as early as next month, according to people familiar with the matter. The Bank of Japan has revived its hawkish rhetoric as fears of a sharp fall in the yen resume and political pressure to keep interest rates low fades. Two people familiar with the BoJ's thinking said the change in its rhetoric over the past week had shifted the focus from earlier concerns about the US economy back to the risk of inflation from a weaker yen, and was meant to remind markets that a December rate rise was still possible. An important meeting last week between Tsuneo Takaichi, prime minister, and Kazuo Ueda, BoJ governor, appeared to remove political opposition to a rate rise from the new government. However, sources pointed out that whether to raise interest rates in December or postpone them to January remains a delicate choice, as the Federal Reserve's interest rate decision will affect the trend of the yen, which will be announced a week before the Bank of Japan meeting. (Jin Ten)