Junko Nakagawaa member of the Bank of Japan’s monetary policy board, declared on Wednesday that “the BoJ to decide the fate of the remaining pandemic relief program at its September meetingwith an eye on the impact of the pandemic on financial conditions.”
Featured Statements
The BoJ’s policy response has had the desired results.
Japan’s consumer inflation has passed 2%, but reaching 2% will not be enough.
What the BoJ wants is a positive cycle in which wages and inflation rise sustainably, driven by rising corporate profits and an improving labor market..
The BoJ must continue monetary easing to achieve the inflation target on a sustained and stable basis, supported by a positive economic cycle.
The Japanese economy, mainly consumption, continues to rebound as the impact of the pandemic subsides.
Japan’s production and exports are weak due to parts shortages and global supply constraints.
Sales prices in Japan are not rising as fast as raw material costs.
Japan will continue to see energy, food and industrial goods prices rise for the time being.
Japanese inflation is likely to accelerate moderately as a trend.
There is uncertainty about whether consumption can sustain a moderate increase even if prices rise.
The impact of inflation on household spending needs to be carefully monitored.
Source: Fx Street
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