Bank of Japan Deputy Governor Shinichi Uchida signaled in a speech on Wednesday that the central bank will continue raising interest rates, citing sustained inflation and wage growth.

He said January's rate hike to 0.5% was a necessary step to adjust monetary policy, as price gains have remained above 2% for nearly three years.

Despite the increase, financial conditions are still accommodative, he said, suggesting room for further tightening. Uchida also pointed to labor shortages and structural constraints, arguing that gradual rate hikes will support long-term stability.