BOJ should avoid December rate hike, says Takaichi's economic adviser

TOKYO (Reuters) -The Bank of Japan should avoid raising interest rates in December and wait at least until January next year to support a fragile economy, Takuji Aida, an economist chosen to join a key government panel, told the Nikkei newspaper.

The government should cushion the blow to households from rising living costs with big spending until their real income turns positive, Aida, who is chief Japan economist at Credit Agricole, told Nikkei in an interview published on Monday.

“It would be quite risky for the BOJ to raise interest rates in December,” as Japan’s economy likely contracted in the third quarter, said Aida, who has been chosen to join premier Sanae Takaichi’s flagship panel to debate her administration’s growth strategy.

Raising rates in December would also run counter