BOJ Board Member Signals Gradual Rate Hikes Ahead After Surprise Increase

• Bank of Japan Board Member Tamura signaled desire for gradual interest rate hikes towards policy normalization after last week's rate increase • Tamura emphasized importance of restoring normal functionality of interest rates within 2% inflation target framework

• Tamura didn't give clear hints on timing of next potential normalization step, but most economists expect another rate hike by October

• As leading hawk on BOJ board, Tamura's remarks seen as indicator of bank's policy thinking given his past record

• Tamura called for broad BOJ policy review in Dec 2022 before Governor Ueda announced it in April 2023