Bank of Japan likely to raise inflation forecast to over 2.5% - Kyodo (updated)
17/10/2022 10:30
(Adds detail, background)
TOKYO, Oct 17 (Reuters) - The Bank of Japan (BOJ) will
raise its inflation forecast for this fiscal year to above 2.5%
at its next policy meeting as a weakening yen and higher raw
material costs drive up prices, the Kyodo news agency cited
sources as saying on Monday.
While the upgrade will bring inflation more firmly above the
central bank's 2% target, the BOJ policy board was likely to
keep ultra-loose monetary policy in place to support Japan's
economy, Kyodo said.
In quarterly projections due to be released at the
conclusion of the Oct. 27-28 policy-setting meeting, the BOJ
would likely increase its core consumer inflation forecast for
the fiscal year through March 2023 to above 2.5% from the
current estimate of a 2.3% rise, Kyodo reported.
While consumer inflation has exceeded the BOJ's 2% target,
central bank Governor Haruhiko Kuroda has characterised recent
inflation as being cost-push, emphasising it must be accompanied
by stronger wage growth to consider altering the ultra-easy
policy.
Consumer inflation is expected to fall short of the central
bank's target in the next fiscal year, Kuroda told parliament on
Monday.
(Reporting by Mariko Katsumura and Daniel Leussink
Editing by Chang-Ran Kim, Robert Birsel)
((daniel.leussink@thomsonreuters.com; Twitter:
@danielleussink;))