Bank of Japan Deputy Governor Ryozo Himino stated on Tuesday that the central bank will consider the timing and pace of policy adjustments while closely monitoring the impact of Middle East developments on Japan's economy and prices.

Responding to questions in Japan's parliament regarding the recent rise in government bond yields, Himino said, "It is important to maintain market confidence that inflation will be appropriately controlled, meaning adjusting the degree of monetary easing at an appropriate pace in the future based on economic, price, and financial conditions."

Japan's benchmark 10-year government bond yield reached 2.8% last week, the highest level since October 1996, driven by concerns over global inflation and Japan's fiscal expansion.

Himino noted that, given "real interest rates remain at very low levels," the Bank of Japan expects to continue raising policy interest rates in line with economic, price, and financial conditions.

"However, the timing and pace of such adjustments will be carefully considered, including analyzing how the Middle East situation affects Japan's economy and prices, as well as assessing the likelihood of our baseline scenario materializing and the associated risks," he added.