Japan is seeing conditions fall in place for the central bank to normalize monetary policy, said ruling party heavyweight Katsunobu Kato, underscoring growing political support for further interest rate hikes.
But Kato said the Bank of Japan must keep a close eye on economic conditions and coordinate carefully with the government in working out when to raise rates.
"Japan is shifting to an era where prices and wages rise, from one where both barely moved," said Kato, a former chief Cabinet secretary and a ruling party veteran seen by some analysts as a candidate to become future prime minister.