[Sources: Bank of Japan May Maintain Inflation Risk Warning but Views Risks as Not Significantly Escalated] Jin10 News, July 24 – Three informed sources revealed that the Bank of Japan (BOJ) is likely to maintain its warning about inflation exceeding the 2% target next week, while signaling that these risks have not significantly increased compared to three months ago. It is expected that in the quarterly outlook report to be released during next week’s policy meeting, the BOJ will focus on persistent inflation risks stemming from the Middle East conflict, strong global demand for artificial intelligence, and rising import costs due to the yen's weakness. At the same time, the BOJ believes that the worst-case scenario—severe supply disruptions triggering a price surge and forcing the central bank to raise interest rates rapidly—has become less likely compared to three months ago. Additionally, the statement from June’s rate hike, which noted the "potential risk of consumer inflation deviating upward from the 2% target," is also expected to reappear. According to the sources, as the short-term inflation shock risk driven by oil prices has eased, policymakers are now shifting their focus to the extent to which businesses continue to pass rising costs onto households. This shift indicates that the BOJ is moving beyond the direct impact of the Middle East conflict and is turning its attention to broader inflationary factors, including AI-related demand and yen depreciation, to assess the timing of the next rate hike.