BOJ set to lift rates to 1% as governor Ueda hospitalized

The Bank of Japan is poised to raise its key interest rate to a three-decade high at its policy meeting concluding on June 16, a pivotal move in its shift away from ultraloose monetary policy. The decision comes amid unusual circumstances, as Governor Kazuo Ueda will be absent from the meeting after being hospitalized on June 10 for treatment of an infected liver cyst.

Officials announced the 74-year-old governor is expected to remain in the hospital for approximately two weeks but will work remotely and submit a written statement on his policy views. This marks the first time since 1998 that a governor has missed a scheduled policy-setting meeting. Deputy Governor Ryozo Himino will preside over the rate review, while Deputy Governor Shinichi Uchida will host the post-meeting press conference.

The central bank is widely expected to raise its short-term policy rate by a quarter-point to 1.0%, a level not seen since 1995. Market pricing and economist surveys indicate a near-certain probability of the hike, with a recent Reuters poll showing 94% of economists forecasting the increase. The move is driven by persistent inflation, which has remained above the bank's 2% target for over...