TMTPOST--Naoki Tamura, the most hawkish member of the Bank of Japan’s board, has suggested that the central bank should raise its benchmark rate more aggressively than anticipated. He pointed out that Japan’s neutral policy rate is around 1% or higher. In a speech delivered Thursday to local business leaders in Okayama, western Japan, Tamura stated, “We need to elevate the short-term rate to at least approximately 1% during the latter part of the bank’s projection period through fiscal 2026. This adjustment is essential to address upside price risks and to achieve a stable and sustainable inflation target.” Following Tamura’s comments, the yen strengthened against the dollar before retreating from its gains. Tamura, known for his more hawkish stance among the nine board members, emphasized the necessity of a gradual increase in rates from the current 0.25%. His remarks came just a day after board member Junko Nakagawa supported the BOJ’s existing policy stance, which had driven the yen to its highest level this year. Although Tamura supports future rate hikes, his speech suggested that immediate policy changes are unlikely when the board convenes next week.