Former Bank of Japan board member Seiji Adachi expressed the view that if long-term interest rates exceed 3%, the government is highly likely to request the BOJ to increase its purchases of government bonds. From the perspective of fiscal sustainability, he said that 3.0 to 3.5% is the line the government must defend at all costs. Regarding BOJ rate hikes, he forecast that with one more hike bringing the policy rate to 1.25%, the exit strategy would be complete, after which the bank would shift to normal monetary policy based on the Taylor rule. He said the current rise in long-term rates is entirely due to a fiscal premium, noting that the market is extremely concerned about future fiscal discipline. Long-term rates briefly touched 2.900% on the 9th, the highest level since September 1996. Adachi explained that adding 2% inflation to 1% real growth gives 3% nominal growth, so around 3 to 3.5% is the line that must be defended to maintain fiscal sustainability. The BOJ has indicated it will respond flexibly, such as by increasing bond purchases if long-term rates rise sharply, and Adachi said that depending on how long-term rates rise, the government may request an increase in bond buying. He also said it is convenient for the government that the BOJ considers bond purchases separately from monetary policy. On policy management, he said that with one more rate hike bringing the policy rate to 1.25%, the exit policy would end, after which the bank would shift to normal monetary policy based on the Taylor rule, and he predicted that considering the impact of government measures against high prices on inflation, rates would probably be raised to around 1.5%. He suggested the next rate hike could come sometime between October and January next year, followed by one hike next year, or possibly two depending on crude oil market trends. He sees the nominal neutral rate when the price target is achieved at roughly 1.25%, and said that if the BOJ drops the phrase adjusting easing when it hikes to 1.25%, the policy rate will have almost reached the neutral rate, signaling a shift to a stance of tightening to curb inflation, and he noted that the pace of rate hikes could accelerate depending on the situation.