A Bank of Japan board member said rates should be raised at an early stage if the economy shows no clear signs of weakness, citing persistent inflation risks linked to the Iran conflict, reinforcing expectations for further tightening, Bloomberg reported Thursday.
"If statistical data do not indicate clear signs of an economic downturn, I believe it is desirable to raise the policy rate at the earliest stage possible," Kazuyuki Masu said at a business conference in Kagoshima, according to the report.
The comments add to growing market expectations for a possible BOJ rate increase as early as June, following a divided April meeting in which some board members backed tightening, the report said.
The yen strengthened after the remarks before trimming gains later in the session, as traders also tracked geopolitical developments including comments from Chinese President Xi Jinping on Taiwan during talks with U.S. President Donald Trump, according to the report.
(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)