According to Ueda, this risk is greater than the risk of a weakening in growth.
The statement, made at a press conference, comes after a divided board - six votes in favor and three dissenting - decided to leave the policy rate in Japan unchanged at 0.75 percent.
The split in the executive board is unusually large for Japan, and market pricing puts the probability of a rate hike at the next meeting at over 70 percent.
The Japanese yen initially rose after the statement, but fell back slightly after Ueda appeared to tone down expectations of an imminent interest rate hike.
