The Bank of Japan will likely be raising interest rates as it is behind the curve in dealing with the risk of inflation, U.S. Treasury Secretary Scott Bessent told Bloomberg Television, in his most explicit comment on Japan's monetary policy.

Japan’s chief trade negotiator Ryosei Akazawa said US Treasury Secretary Scott Bessent isn’t directly asking Japan to hike interest rates, a day after Bessent moved markets by describing the Bank of Japan as being behind the curve in fighting inflation.

US Treasury secretary Scott Bessent has said that Japan’s central bank is falling “behind the curve” on inflation and will probably have to raise interest rates, in a rare swipe by a senior official at the monetary policy of another country.