BoJ to Proceed Carefully on Interest Rates: Board Member Nakagawa

The Bank of Japan will continue raising interest rates if its outlook for economic activity and prices is realized, board member Junko Nakagawa said in a speech. She emphasized the importance of the upcoming September Tankan survey, which will help assess the impact of global trade negotiations. Nakagawa noted “high uncertainties remain over the future course of trade policies and their impact,” warning that these could dampen business and household sentiment both in Japan and abroad. While Japan’s economy has recovered moderately, some areas remain weak. The BoJ will continue to assess data carefully before making policy decisions. Nakagawa also flagged potential upward pressure on wages and selling prices, but cautioned that if firms prioritize cost-cutting over passing on tariff-driven cost increases, wage growth momentum could weaken. Shifts in corporate behavior toward raising wages and prices will be closely watched.