The former Chief Economist of the Bank of Japan believes there is a high likelihood of a rate hike this month.

MaticHoleFiller · 2026-04-11T00:29:10+00:00

Former Chief Economist of the Bank of Japan, Toshitaka Kaneko, stated that the Iran conflict has increased inflation risks, which could prompt the Bank of Japan to raise interest rates in April. He believes that after assessing the situation, by the end of April, there will be a clearer understanding of the Middle East's impact, and the central bank may have a definitive view on the necessity of rate hikes.

MaticHoleFiller

2026-04-11 00:29:10

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According to Takashi Kuranaka, former chief economist of the Bank of Japan, the Iran conflict has heightened inflationary risks, providing the Bank of Japan with a reason to raise interest rates as early as this month.

On Wednesday, Kuranaka stated in an interview that if the goal is to assess the situation, taking action in April is feasible. We can at least determine by the end of April whether the impact of the Middle East situation is merely temporary.

Although commentators are still debating whether geopolitical shocks will cause inflation or deflation in a resource-scarce country like Japan, Kuranaka’s remarks suggest that the Bank of Japan may have a clearer view on the necessity of a rate hike at the policy meeting on April 28.

Having served at the Bank of Japan for over 30 years until 2020, Kuranaka speculates that current central bank officials may share his view, as the minutes from the March policy meeting explicitly indicate that members are increasingly concerned about inflation risks.

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Editor: Yu Jian SF069

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