TOKYO (Kyodo) -- The Bank of Japan is expected to keep its policy rate unchanged at its two-day meeting from Tuesday amid increasing uncertainty over the impact of U.S. President Donald Trump's tariff plans on the country's economy and prices.

The bank is inclined to assess the impact of the 25 percent tariffs on steel and aluminum imports imposed by Trump earlier this month. He is also considering extending the levy to auto imports, a move that could hit Japanese carmakers hard.

Ahead of the meeting, Deputy Governor Shinichi Uchida voiced concern over the impact of Trump's trade policy, saying, "It will affect the domestic growth rate through overseas economies."

The central bank, which ended its negative rate policy in March last year and hiked the policy rate in July and January, has said it will not hesitate to increase borrowing costs further if the economy and prices continue to move in line with its expectations.

Many market players expect the bank to raise the policy rate about every six months, based on the timing of recent hikes, but some believe the next increase from the current 0.5 percent could come before summer to rein in soaring inflation.

Japanese households have been under pressure following a historic rise in rice and vegetable prices. A weak yen is also making the cost of imports more expensive.

Japan's core consumer prices, a key indicator the BOJ closely monitors, rose 3.2 percent in January from a year earlier, the fastest pace in 19 months. The inflation rate has been at or above the bank's 2 percent target since April 2022.

To alleviate the burden, many Japanese companies agreed to offer bumper pay hikes in this year's spring wage negotiations, with the average increase reaching 5.46 percent, according to the Japanese Trade Union Confederation's preliminary survey released last week.

This would be the second straight year of wage increases exceeding 5 percent in a country where growth has long been subdued by deflation, a trend that could push the BOJ to continue its planned rate hikes, analysts say.