Bank of Japan policymakers see room for further rate hikes as inflation moves toward the 2% target, while some members favored holding rates steady to assess past increases, according to the minutes of the July 30-31 meeting released Monday.

The central bank noted that the timing and pace of future adjustments will depend on geopolitical developments, foreign exchange movements, and AI-driven demand, with officials projecting moderate economic growth and gradual inflation acceleration through fiscal 2027.

On inflation, policymakers highlighted upside risks from the weak yen, higher import prices, geopolitical developments and strong AI-related demand.