Former Bank of Japan (Bank of Japan (BOJ)) Governor Haruhiko Kuroda stated that, given the already strong economic conditions, it is necessary to continue raising interest rates and tightening fiscal policy. He warned that Prime Minister Sanae Takaichi’s massive spending plan could trigger runaway inflation.Kuroda is known for the aggressive monetary stimulus he introduced in 2013, which was a key component of former Prime Minister Shinzo Abe’s “Abenomics” reflation strategy.He indicated that with the economy growing steadily and wages rising steadily, Bank of Japan (BOJ) may raise interest rates about twice a year in 2026 and 2027. “Today, Japan faces inflation and yen depreciation. Japan needs to shift to tighter fiscal and monetary policies. Bank of Japan (BOJ) Interest rates must be gradually raised to neutral levels. Fiscal policy must also be tightened. I have doubts about whether increased spending and tax cuts are appropriate.” Kuroda warned that expansionary fiscal policy could backfire, exacerbating inflationary pressures and pushing up bond yields.