Bank of Japan Governor Kazuo Ueda warned that yen weakness is increasingly feeding into import costs and consumer inflation, saying currency swings now have a bigger impact than in the past. Ueda said Japanese firms have become more willing to raise both wages and prices, which heightens the sensitivity of inflation to foreign-exchange moves.
He emphasised that the BOJ must stay alert to the risk that sharp currency volatility could influence inflation expectations and underlying price dynamics. Ueda said the central bank will closely scrutinise how FX fluctuations are affecting inflation as it guides policy.
His comments come amid renewed pressure on the yen and rising speculation about when the BOJ might deliver its next rate hike.
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Ueda’s remarks highlight rising BOJ sensitivity to yen-driven inflation, adding modest support to JPY as markets reassess the timing of the next rate hike.
