Barclays economists said remarks by Bank of Japan policy board member Koeda
reinforced the case for further tightening. Koeda said Japan’s neutral rate
could be “well above 1%” and that adding a 2% inflation rate to potential growth
implies a neutral rate possibly above 2%. Barclays forecasts a 25bp hike in Dec
2026, followed by further increases in Mar and Jul 2027, taking the policy rate
to a 2% terminal level.
