The Bank of Japan signaled that the shrinking of Japan’s population means that it’s increasingly difficult to achieve robust growth in overall consumer spending, suggesting that weak aggregate consumption by itself might not point to deteriorating household demand.

Bank of Japan Governor Kazuo Ueda signaled strong prospects for hiking the benchmark interest rate in December, hours after declaring underlying inflation had hit a long-sought goal of 2%.

The Bank of Japan is widely expected to keep its benchmark interest rate unchanged on Friday while indicating that underlying inflation has finally reached its 2% target, a milestone that would strengthen the case for further rate hikes.

The Bank of Japan’s gauge of underlying inflation surged to the highest in three years, well above the bank’s 2% target, backing the case for authorities to continue raising interest rates.

The Bank of Japan may maintain a continued fast pace of rate hikes given current price trends and a view at the bank that the impact of increases on the economy so far has been limited, with December the next potential move, according to people familiar with the matter.

Japan’s key price gauge rose above the Bank of Japan’s target level for the first time this year, supporting the case for a widely expected BOJ interest rate hike in December.

More than 80% of Bank of Japan watchers anticipate the central bank’s next interest rate increase will come in December, according to a recent Bloomberg survey. None expect a hike when the bank concludes its next meeting on Oct. 30.

The Bank of Japan will probably keep raising interest rates every three months to contain risks of inflation deviating from its stable price target, according to a former BOJ executive director who oversaw monetary policy.

Bank of Japan Board Member Junko Koeda warned against too much caution over raising interest rates, in comments that suggest the central bank is firmly on track to hike borrowing costs again in the coming months after accelerating the pace of normalization.

Bank of Japan officials are leaning against a rare back-to-back interest rate increase this month while still eyeing the possibility of another move as soon as December, according to people familiar with the matter.

The growth of corporate goods prices in Japan eased again while staying at elevated levels, indicating that inflationary pressure from input costs may have peaked for now and suggesting less urgency for the Bank of Japan to raise interest rates after last month’s hike.

Prime Minister Sanae Takaichi said Japan no longer needs policy to stimulate inflation as the economy isn’t in a state of deflation anymore, echoing a comment made recently by US Treasury Secretary Scott Bessent.

Bank of Japan Governor Kazuo Ueda gave little indication that he intends to challenge prevailing bets against a back-to-back interest rate increase this month, reiterating the bank’s standing policy views.

Artificial intelligence is causing a surge in demand that is fueling inflationary pressure and long-term interest rates, with an impact that may affect the neutral rate of interest, according to Bank of Japan Deputy Governor Shinichi Uchida.

Japan’s Economic Policy Minister Minoru Kiuchi declined to elaborate on remarks made by a government representative at the Bank of Japan’s latest policy meeting that appeared to urge caution over the pace of further interest rate hikes.

Tokyo’s key inflation gauge rose sharply as the effects of some temporary government measures faded, backing the Bank of Japan’s stance on continuing to raise the benchmark rate after authorities accelerated the pace of policy normalization.

The Bank of Japan affirmed that its policy focus has shifted to preventing inflation from overshooting its target but didn’t offer hints signaling growing support for a move this month in a summary of opinions from last month’s policy meeting.

Confidence among Japan’s largest firms remains elevated with sentiment among manufacturers rising to the highest level in more than eight years, a result that suggests the Bank of Japan can continue raising interest rates without buckling corporate optimism.

The Bank of Japan could raise its benchmark rate for a second straight month when the board meets in October, earlier than many economists expect, according to a former executive director in charge of monetary policy.

The Bank of Japan’s gauge of underlying inflation accelerated to well above the target last month, supporting the case for continuing to raise the benchmark rate as authorities warn of the risk of inflation overshooting.