US Treasury Secretary Scott Bessent said the Bank of Japan is “behind the curve” on inflation and will need to raise interest rates, marking an unusual public rebuke of another nation’s monetary policy. In a Bloomberg Television interview on 14 August, Bessent said he had discussed Japan’s persistent price pressures with BOJ Governor Kazuo Ueda and expects the central bank to move rates higher. Japan’s core consumer price index has stayed at or above the BOJ’s 2% target for more than three years, while the policy rate remains among the lowest in the developed world. Economists surveyed by Bloomberg now see a growing likelihood of action: 42% predict a rate increase in October and roughly one-third look to January, with the next policy decision due on 19 September. Bessent’s remarks jolted financial markets. The yen rose to around ¥146 per dollar, its strongest level in nearly three weeks, and yields on 10-year Japanese government bonds inched higher. Tokyo’s Nikkei 225 index, which had been probing record highs, fell 625 points, or 1%, to 42,649 as investors weighed the prospect of tighter Japanese and looser U.S. policy. The comments add political pressure on the BOJ as it weighs the timing of its next move and underscore Washington’s broader scrutiny of exchange-rate dynamics. A BOJ spokesperson confirmed that Bessent and Ueda speak regularly at international forums but declined to detail their discussions.