Daiwa Institute economist Kanako Nakamura said the BOJ cited accelerated cost
pass-through as a reason to tighten, noting import-cost increases from Middle
East tensions, combined with an ongoing wage–price cycle, are pushing up
inflation. She warned that even if oil stabilizes with progress on peace talks,
cost increases have spread from plastics and ethylene into power, gas and
transport, implying persistent price pressure. Markets will watch whether the
BOJ issues stronger signals for further hikes; Nakamura said continued rate
increases may be needed to prevent further yen depreciation amid persistent
Japan–US rate differentials.
