Bank of Japan officials: Support for rate hikes will only follow inflation driven by stronger demand

```htmlGolden Ten Data reported on July 8 that Japan Central Bank Policy Board Member Ichiro Asada said he must see signs that demand is driving inflation before supporting an interest rate hike. However, he also pointed out that the transmission of cost increases is "relatively fast," indicating he may vote in favor of a rate hike in the future. Asada made these remarks during his first interview after joining the policy committee. He was appointed by dovish Prime Minister Sanae Takaichi as a Policy Board Member. In June, Japan Central Bank raised interest rates to a 31-year high of 1%, and Asada was the sole dissenter to this decision. He explained his opposition vote was due to ongoing uncertainty in the Middle East, which could impact output and employment. The key prerequisite for supporting future rate hikes is that Japan has the conditions for sustainably achieving its 2% inflation target. "Additionally, I believe it's necessary to confirm this target is reached through endogenous economic forces such as rising wages and expanding demand," he added, noting that these forces are currently insufficient to justify a rate hike. However, Asada stated that future decisions will depend on the economic conditions at the time. Despite falling oil prices and slowing consumer inflation, the impact of previous oil price increases is being transmitted at a "relatively fast pace," and may lead to a general rise in prices of various goods.```