TOKYO: Some Bank of Japan policymakers noticed client inflation briefly accelerating towards 2 per cent as value pressures construct up on altering company price-setting behaviour, a summary of opinions on the financial institution’s January meeting confirmed on Wednesday (Jan 26).
“There’s a chance year-on-year growth in consumer inflation may briefly approach 2 per cent. If that happens, what’s important is to look at facts behind the rise and whether they’re sustainable,” one of the BOJ’s 9 board members was quoted as saying.
“Consumer inflation may temporarily reach levels of around 1.5 per cent in the first half of 2022. Whether that momentum is sustained enough for inflation to stably approach the BOJ’s 2 per cent target would depend on wage and inflation expectations – or in sum the strength of demand,” a second opinion mentioned.
Many BOJ board members, nonetheless, confused the necessity to keep the financial institution’s ultra-loose financial coverage to help the still-fragile financial restoration, the summary confirmed.
At the January coverage meeting, the BOJ raised its inflation forecasts however mentioned it was in no rush to alter its ultra-loose coverage. The prospect of rising costs has fanned hypothesis the central financial institution might quickly sign a shift in its decade-old stimulus experiment.