Bank of Japan Governor Kazuo Ueda declared that monetary policy has entered a new phase as underlying inflation approaches 2%, confirming the central bank will continue raising interest rates and adjusting easing measures. Ueda emphasized that further inflation increases cannot be allowed given current financial conditions remain accommodative, with the BOJ set to discuss whether to formally adjust its assessment of inflation stability at upcoming meetings. The timing of future rate hikes will depend on Middle East developments, AI-driven demand, and exchange rate movements, according to Ueda. While noting difficulty in precisely defining Japan's neutral rate, he stressed that consolidating the 2% inflation target is increasingly critical. Ueda also confirmed recent discussions with Fed Chair Warsh and G20 policymakers regarding global economic impacts from geopolitical tensions and artificial intelligence trends.