Bank of Japan Governor Kazuo Ueda has indicated that the central bank may continue raising its benchmark interest rate if Japan's economy and inflation develop in line with the bank's central outlook. Ueda emphasized that the real policy rate remains deeply negative, but signaled readiness to adjust the degree of monetary easing as needed, depending on incoming economic data. Ueda highlighted the high level of uncertainty surrounding trade policies, particularly those related to tariffs enacted by the Trump administration, and stated that any future rate hikes would be decided with caution. He noted that underlying inflation is currently between 1.5% and 2.0%, and while the policy stance remains accommodative, the Bank of Japan will closely monitor price trends, especially the impact of rising food prices. The yen strengthened following Ueda's remarks and the release of solid inflation data, including a 3.1% year-on-year increase in the Services Producer Price Index for April 2025. European Central Bank President Christine Lagarde also commented that US policy is helping to boost the euro's global role.