BOJ likely to raise rates as soon as December, ex-central bank executive says

By Leika Kihara and Yoshifumi Takemoto

TOKYO (Reuters) -The Bank of Japan is likely to raise interest rates as soon as December as expansionary fiscal policy expected under new Prime Minister Sanae Takaichi will help the economy weather the hit from U.S. tariffs, former BOJ executive Eiji Maeda said.

Maeda also said the central bank should proceed steadily with further rate hikes as the slow pace of increase is creating side effects such as soaring property prices in big cities and a weak yen that is driving up households’ cost of living.

“The BOJ may already be somewhat behind the curve in addressing inflationary risks, which is causing some distortions in the economy,” he told Reuters in an interview on Wednesday.

“Moving too slowly in policy normalisation would hurt people’s livelih