BoJ officials see recent Yen weakness as upside inflation risk, open to raising rates faster

Bloomberg reports that Bank of Japan officials view the yen’s recent weakness as an upside inflation risk, increasing the odds of faster rate hikes than the previously expected pace of one hike every six months. The comments suggest the BoJ may become more responsive if the weak currency feeds imported inflation, even though policymakers are still broadly expected to hold rates steady at the upcoming July meeting after a June hike. The article reinforces the market’s focus on the yen, BoJ tightening expectations, and the potential for higher Japanese rates to support the currency if policy normalization accelerates.