The Bank of Japan must raise interest rates to at least 1% by late next year, hawkish policymaker Naoki Tamura said on Thursday, reinforcing the bank's resolve to persist with steady monetary tightening.

Bank of Japan policy board member Naoki Tamura said the central bank should raise interest rates to around 1% in the near future, fueling expectations of several rate increases.

Bank of Japan officials see little need to raise the benchmark rate when board members gather next week, as they’re still monitoring lingering volatility in financial markets and the impact of the July hike,

The Bank of Japan will continue to raise interest rates if inflation moves in line with its forecast, policymaker Junko Nakagawa said, signalling that last month's market rout has not derailed the bank's plan to hike borrowing costs steadily.

Bank of Japan policy board member Junko Nakagawa on Wednesday repeated the bank’s stance of pursuing more rate increases, sending the yen to its strongest level in eight months.