Key Facts
• On January 6, MUFG President Hiroki Kamezawa called for the Bank of Japan to raise interest rates again in early 2026.
• The Bank of Japan raised its policy rate to about 0.75% in December 2025, the highest in nearly 30 years.
• Kamezawa emphasized that inflation response should not be delayed.
• He stated that companies willing to take risks will grow during rising interest rates.
• MUFG sees its role as supplying risk capital to support growth.
• For 2026, Kamezawa expects a mild yen appreciation as the main scenario but notes short-term yen depreciation risks.
• Despite the rate hike and narrowing Japan-US interest rate gap, the yen remained weak at around 150 yen per US dollar after December 2025.
• Kamezawa suggested Japan’s national strength might not be fully recognized by the market.
Summary
MUFG President Hiroki Kamezawa expressed his view on January 6 that the Bank of Japan should implement another interest rate hike in the first half of 2026 to address inflation promptly. Following the December 2025 rate increase to approximately 0.75%, the highest in three decades, Kamezawa highlighted the importance of supporting companies that take risks, positioning MUFG as a key provider of risk capital. He forecasted a gradual yen appreciation over the year but warned of short-term yen depreciation. Despite the narrowing interest rate gap between Japan and the US, the yen remained weak above 150 per dollar, leading Kamezawa to suggest that Japan’s economic strength may not be fully valued by financial markets. His comments were made at a New Year’s party for three economic organizations in Tokyo.
