TOKYO :The Bank of Japan must hold off raising interest rates for the time being, its board member Toyoaki Nakamura said on Friday, warning of growing downward pressure on the economy from higher U.S. tariffs.
Nakamura, known as the most dovish member of the board, said the central bank must guide monetary policy “cautiously” with due attention to how extremely high uncertainty over U.S. trade policy could affect corporate and household activity.
“Japan’s economy is facing mounting downward pressure,” as steep U.S. tariffs, including on its mainstay automobile sector, could seriously hurt corporate profits, Nakamura said in a speech.
“Rushing to raise interest rates when growth is slowing could curb consumption and investment with a lag,” said Nakamura, a former corporate executive whose five-year term at the board expires at the end of June.
