Main Opinions at the September 17–18 Policy Meeting
Overview
The Bank of Japan published the views of Policy Board members and government representatives at the monetary policy meeting held on September 17 and 18, 2026. While some saw the economy recovering moderately despite the effects of the Middle East situation, others pointed to weak domestic demand and upside risks to prices. In light of assessments of underlying inflation and financial conditions, some considered a rate increase appropriate while others favored keeping rates unchanged. The views also addressed policy flexibility, communication, and coordination with the government.
Key points
- The Bank of Japan published the main opinions expressed at the monetary policy meeting held on September 17 and 18, 2026.
- Some opinions anticipated a moderate economic recovery, while others pointed to weak domestic demand and upside risks to prices.
- The document presented both opinions that raising the policy rate was appropriate and opinions favoring keeping it unchanged.
- The opinions are organized into three sections: economic and price conditions, monetary policy conduct, and government views.
Overview
The document is prepared by having each Policy Board member and government representative submit a summary of their meeting remarks to the chair within a specified character limit; the chair then edits the submissions by topic.
“I. Opinions on Economic and Price Conditions” covers the economy and prices; “II. Opinions on Monetary Policy Conduct” covers the policy rate and future policy; and “III. Government Views” covers the positions of the Ministry of Finance and the Cabinet Office.
Impact
The Cabinet Office stated that the Bank of Japan's independent and appropriate response would be important if excessive fluctuations occurred in the economy or markets.
Details
On economic conditions, some opinions held that moderate growth would continue, with global demand for AI-related products providing support alongside government measures, even as the Middle East situation weighed on activity. Another opinion noted that domestic demand was negative in the April–June quarter and that the positive contribution from external demand was due to lower imports, concluding that growth could not be called robust.
On prices, several assessments held that underlying inflation was close to 2%, had broadly reached that level, or would rise further. Concerns were raised that higher import prices associated with the Middle East situation, as well as increases in crude oil, packaging materials, food trays, and logistics costs, could push prices higher. One opinion said that, partly due to the effects of government measures, year-over-year consumer price inflation was in the upper 1% range recently for both the index excluding fresh food and the index excluding fresh food and energy.
On policy conduct, several opinions called for adjusting the degree of monetary easing through a rate increase in view of accommodative financial conditions and upside risks to prices. Others favored holding rates unchanged at this meeting, citing inflation below 2% and a lack of economic strength. Opinions also called for judging the timing and pace of future rate increases flexibly in light of economic, price, and financial conditions, while considering estimates of the neutral interest rate and the responses of businesses, households, and financial institutions.
The Ministry of Finance called for close coordination with the government, clear explanations of the purpose of policy changes, and assessment of their effects on the economy and prices. The Cabinet Office also called for accountability in explaining decisions, assessment of the cumulative effects of past rate increases, and consideration informed by the neutral interest rate.