Bank of Japan Deputy Governor Ryozo Himino did not provide a clear signal regarding a near-term interest rate increase on Monday. Following the outbreak of conflict in the Middle East over the weekend, his remarks have reinforced market expectations that the central bank will maintain its current policy stance this month.
Speaking to local business leaders in Wakayama City, western Japan, Himino stated, "I believe it is necessary to closely monitor the situation in the Middle East."
Given the increasing uncertainty in the macroeconomic outlook after military strikes by the United States and Israel against Iran, these comments indicate a low probability of the Bank of Japan raising interest rates at its policy meeting on March 19th.