BNP Paribas: Japanese inflationary pressures are expected to persist and will not be affected by the outcome of the Middle East situation

They stated that the ongoing tensions could push up inflation expectations, and even if the situation eases, energy prices are unlikely to quickly return to pre-conflict levels. They noted that domestic pressures, such as rising recruitment costs, also exacerbate the upward trend in prices. These economists said, "If the Bank of Japan skips a rate hike citing uncertainty, it seems very likely they will fall behind the curve."