Tsutomu Watanabe, a former Bank of Japan official and price trend expert, said that the Bank of Japan may shift from tolerating inflation to a policy stance against inflation as early as December, which means that the pace of interest rate hikes will accelerate. He said that after the Ukraine conflict triggered the first round of inflation, domestic wage increases, and the rise in rice prices spawned the second round of inflation, the Middle East conflict is driving Japan into a third wave of inflation. The professor of economics honorary at the University of Tokyo said in an interview on Wednesday that the third round of inflation is likely to be weaker than the previous two; the core consumer inflation rate, which excludes fresh food and energy, is expected to peak around 3% next March, then gradually fall back, moving closer to the Bank of Japan's 2% inflation target. He pointed out, “But what is really worth being wary of is the core inflationary momentum. The indicator is clearly rising and is now very close to 2%.” The labor market continues to be tight, compounding a wave of widespread price increases, driving up wage growth and inflation expectations.

Tsutomu Watanabe, a former Bank of Japan official and price trend expert, said that the Bank of Japan may shift from tolerating inflation to a policy stance against inflation as early as December, which means that the pace of interest rate hikes will accelerate. He said that after the Ukraine conflict triggered the first round of inflation, domestic wage increases, and the rise in rice prices spawned the second round of inflation, the Middle East conflict is driving Japan into a third wave of inflation. The professor of economics honorary at the University of Tokyo said in an interview on Wednesday that the third round of inflation is likely to be weaker than the previous two; the core consumer inflation rate, which excludes fresh food and energy, is expected to peak around 3% next March, then gradually fall back, moving closer to the Bank of Japan's 2% inflation target. He pointed out, “But what is really worth being wary of is the core inflationary momentum. The indicator is clearly rising and is now very close to 2%.” The labor market continues to be tight, compounding a wave of widespread price increases, driving up wage growth and inflation expectations.