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Former BOJ official Watanabe Tsutomu said on Wednesday the BOJ could accelerate rate hikes later this year and lift its policy rate above 2% to rein in inflation. He said the terminal peak will likely be higher than most expect, around 2% or slightly above. Watanabe urged a dynamic assessment of policy, saying the terminal rate depends not only on neutral-rate estimates but also on factors such as inflation overshooting before the BOJ clearly tightens. With core inflation approaching the 2% target, he warned the policy board may shift from a previously passive stance to a more proactive position to prevent an overshoot.

U.S. President Trump said any ongoing developments will be over soon.