The Bank of Japan's Board Member Naoki Tamur said on Thursday that he believes it's necessary to raise the BoJ's short-term policy rate at least to around 1% in the second half of its projection period through fiscal 2026. According to the official, that's needed to contain upside price risks and to achieve a stable and sustainable inflation target.
Tamura, however, indicated that he sees little need to make a policy move at the BoJ's meeting next week.
He also highlighted that the BoJ's policymakers need to closely watch how the economy responds to shifts in interest rates without preconceptions. The official added that he doesn’t have any preconceptions about the pace of rate hikes, but suggested that, unlike in the U.S. and Europe, it’s likely to be a gradual one.