AsianFin -- Bank of Japan Governor Kazuo Ueda said the central bank may need to adjust its monetary policy if rising U.S. tariffs begin to significantly impact Japan’s economy, according to remarks published by the Sankei Shimbun on Wednesday.

In a recent interview, Ueda noted that risks associated with U.S. President Donald Trump’s trade agenda have been “increasingly aligning with the BOJ’s adverse scenario,” raising concerns about the broader economic fallout.

“Since February, the situation has moved closer toward the downside risks we had anticipated,” Ueda said, warning that the tariffs are already eroding business and consumer confidence in Japan.

The comments suggest the BOJ could consider pausing or even reversing its rate-hiking trajectory if external shocks—particularly from escalating trade tensions with the U.S.—begin to drag on growth or destabilize financial conditions.