An interesting situation is developing in Japan. Japanese Prime Minister Sanae Takaichi recently expressed concern during a meeting with Bank of Japan Governor Kazuo Ueda about the potential for further tightening of monetary policy. It might seem like a routine diplomatic discussion, but behind it lies real tension between the government and the central bank.

The reason is clear. The weakening yen is already hitting Japanese households, import prices are rising, and people are feeling pressure on their incomes. If the prime minister is worried, it means societal pressure is genuinely being felt. Ueda, of course, says that the meeting was simply an exchange of views on the overall economic situation, with no specific requests regarding monetary policy. But markets read the signals differently, and the yen immediately weakened against the dollar and euro.

Takaichi herself is cautious in her comments, avoiding specifics. She only emphasizes the need for coordination between the central bank and the government to achieve the target inflation rate of 2% amid rising wages. Essentially, this hints that any interest rate hikes should be cautious and well-coordinated.

There are already rumors in the market that the Bank of Japan may consider raising rates in March or April. If this happens without coordination with the new government, it could make cooperation even more complicated. For now, these are just speculations, but it’s definitely worth monitoring how the situation develops.