Bank of Japan lines up another speaking event ahead of key September meeting

By Leika Kihara

TOKYO, Aug 7 (Reuters) - The ‌Bank of Japan ​has ​set a third speaking event for one of its board members ahead of its next policy meeting in September, events which could drop hints on whether the ‌central bank will meet growing market expectations of a rate hike that month.

Board ⁠member Kazuyuki Masu will deliver a speech and hold a news conference on September 10, the BOJ said on Friday, ‌adding to two existing similar ‌events featuring hawkish board member Hajime Takata on September 2 and Deputy Governor Ryozo Himino on August 27.

REPEAT OF PAST PRACTICES?

The three events would allow the BOJ to repeat the practice ​of past rate increases, where it gave advance signals of a hike in speeches delivered by executives in pre-scheduled events.

Takata dissented on the BOJ's decision in July to keep rates ⁠steady, instead calling for a hike to 1.25%. Masu and Himino are seen by markets as among hawks in the nine-member board ​who favour a near-term rate hike.

U.S. Treasury Secretary Scott Bessent has said he expected to meet BOJ Governor Kazuo Ueda at a U.S.-hosted G20 finance ​leaders' meeting to be held on August 31 and ‌September 1.

If Ueda were to travel and hold a news briefing after the G20 gathering, that, too, will draw market attention as investors seek clues ⁠on whether the BOJ will raise rates at its next policy meeting on September 17 to 18.

Last week's joint Japan-U.S. yen intervention and comments from Bessent signaling his desire for an early rate hike have all ⁠but locked the BOJ into raising rates in September, sources have said.

"Whenever Bessent made comments on Japanese monetary ​policy, the BOJ followed through with rate hikes. With domestic producer prices spiking and expected to continue rising, there's a strong chance the BOJ will raise rates in September," said Mari Iwashita, executive rates strategist at Nomura ‌Securities.

"If the BOJ hikes in September, it could squeeze in another rate increase in December," she said.

The BOJ ended a decade-long, massive stimulus programme ‌in 2024 and has since raised interest rates several times, including in June when it took its policy ⁠rate to a 31-year high of ‌1%.

But the slow pace of hikes ​has been blamed for the yen's slide to a 40-year low, by keeping the Japan-U.S. rate gap wide.

(Reporting by Leika Kihara; Editing by Edwina Gibbs and ‌David Holmes)

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