MNI BRIEF: BOJ Must Watch for Corporate Price Hikes

The Bank of Japan said on Monday that it must pay attention to the possibility that the pass-through of cost increases may become more widespread for some goods which have already seen substantial increases in prices, particularly food.

“Once some food prices start to rise, the rate of increase in the CPI for food tends to accelerate,” said the full text of the BOJ Outlook Report released on Monday.

“Looking at developments in the diffusion index (DI) for firms' output prices in the Tankan to examine their recent price-setting stance, although not quite at the level of the input prices DI, it has reached the highest level since 1991 for the non-manufacturing industry and the highest level since 1980 for the manufacturing industry,” the BOJ said.