Tokyo, 16 October 2026 – Bank of Japan governor Kazuo Ueda warned that underlying inflation could exceed the central bank’s 2% target, citing Middle East tensions, artificial-intelligence demand and currency movements. The remarks came before the Bank of Japan’s 29–30 October policy meeting, when new quarterly growth and inflation forecasts are due.
For Asian investors, the warning matters because Japanese rates and the yen influence regional bond markets, funding trades and cross-border capital allocation. Ueda confirmed the risk assessment, but did not announce a policy move; the timing and scale of any additional tightening remain decisions for the board.
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