MNI BRIEF: BOJ Minutes: Worry Over High Cost Impact On Funding

One Bank of Japan said small and medium-sized firms in particular had raised concern over the impact of the recent rise in raw material costs on their financial positions going forward at the June 16-17 meeting, the minutes released on Tuesday showed.

Another member “pointed out that financial conditions in the nonmanufacturing industry -- particularly the services industry -- had improved with the impact of COVID-19 waning, while those in the manufacturing industry had seen a pause in their improvement, mainly affected by high commodity prices and the lockdowns in China,” the minutes showed.

Member agreed that measures such as the Special Operations to Facilitate Financing had been exerting their intended effects. Policymakers did not make a decision on whether to extend or end the fundingand they will decide on the matter at the September meeting ahead of Sept. 30, when the programme is set to expire.