An inflation gauge in Japan closely watched by the Bank of Japan (BOJ) hit a seven-month high in November, which could prompt the central bank to raise interest rates early next year.

The so-called “core-core” inflation rate, which excludes fresh food and energy prices and is tracked by the BOJ, rose from 2.3% to 2.4%the highest level since April.

The core inflation rate – which takes into account fresh food prices – was 2.7%, up from 2.3% in October and above the 2.6% forecast by economists polled by Reuters.

Headline inflation rose to 2.9% from 2.3%, reaching its highest level since August.

The readings take place the day after The Bank of Japan kept interest rates stable at 0.25%. surprising economists who expected a 25 basis point increase.

The Bank of Japan said in its statement on Thursday that the decision to stay the course was a split 8-1 decision, with board member Naoki Tamura supporting a 25 basis point hike.

Tamura believed that inflation risks were more to the upside and suggested the bank raise interest rates during the meeting.

BOJ Governor Kazuo Ueda reportedly said in a press conference on Thursday that the BOJ can only raise interest rates slowly because underlying inflation is only rising at a “moderate pace,” he said.

However, Ueda added that the central bank is aware that if it delays raising rates for too long, it will have to accelerate rate hikes at future meetings.

Speaking to CNBC”Squawk Box Asia“Masahiko Loo, senior fixed income strategist at State Street Global Advisors, said the inflation data is “pretty much in line with our view.”

He added that the BOJ was “very confident” about the country’s inflation and growth numbers, but Ueda was likely focused on foreign uncertainties, namely the impact of the new Donald Trump administration.

The yen weakened against the US dollar after the BOJ decided to keep interest rates on hold. On Friday it reached 157.92, marking its weakest level since July. However, the currency later became stronger again.

Loo explained that Japan’s finance ministry may try to warn the market as the yen is now “drifting” towards the 160 level against the greenback. Otherwise, it could force a rate hike in January to support the yen.