International Monetary Fund: Forecasts the Bank of Japan will raise interest rates twice this year and once more next year

PANews February 18th News, according to Jinshi Report, the International Monetary Fund (IMF) stated that Japan should avoid cutting consumption taxes to prevent exacerbating fiscal risks. In the latest conclusion statement released on Wednesday regarding the Fourth Review of Japan, the IMF pointed out: “Authorities should avoid lowering consumption taxes, as this non-targeted measure will erode fiscal space and increase fiscal risks.” The organization predicts that as maturing debt is refinanced at higher yields, Japan’s interest payments on public debt will double by 2031 compared to 2025. The IMF warned: “High and sustained debt levels, coupled with worsening fiscal balances, make the Japanese economy vulnerable to a series of shocks.” The IMF’s forecast is consistent with the Japanese government’s estimates. The head of the IMF Japan delegation stated that their forecast assumes the Bank of Japan will raise interest rates twice this year and once more in 2027.