Source: Sharecast
In a speech on Thursday, Masu noted that there were "mixed views" among policymakers at the April monetary policy meeting on whether a rate hike was necessary, with three of the BOJ's nine board members calling for an increase in the policy rate to 1.0%. Instead, rates were held steady at 1.0%.
"I myself judged at the April MPM that the situation did not warrant a hasty policy rate hike," he said.
"That said, if statistical data do not indicate clear signs of an economic downturn, I believe it is desirable to raise the policy rate at the earliest stage possible."
After a long period of chronic deflation following the financial crisis of 2008-09, Japan transitioned into inflation in early 2022, though price pressures have eased as of late because of stabilising rice prices, the abolition of a gasoline tax rate and measures to make reduce the costs of high school tuition.
However, the Iran war has placed central banks worldwide in an "unusually difficult decision-making environment", where energy shortages could both slow down growth but cause a rise in inflation.
Markets are currently pricing in a 70% possibility of a rate hike at the BOJ's next meeting in June.