The Bank of Japan should maintain its loose monetary policy and raise interest rates only gradually amid persistent global trade uncertainties, said Deputy Director of the IMF’s Asia and Pacific Department Nada Choueiri. She noted that Japan’s economy has exceeded expectations this year, helped by solid consumption and exports, while a trade deal with the U.S. has eased some of the uncertainty. However, risks remain tilted to the downside due to unresolved U.S.-China trade tensions and potential shifts in global conditions. “Going forward, gradualism is very important because of the degree of uncertainty,” Choueiri told Reuters, stressing the need to monitor incoming data closely. She also warned that wage growth may not be strong enough to sustain inflation near the BoJ’s 2% target. Political instability has further clouded the outlook, with leadership uncertainty surrounding new ruling party leader, Sanae Takaichi. The BoJ’s next policy meeting is scheduled for October 29–30.