MNI BRIEF: BOJ Nakagawa Warns Of Global Growth Risks

Bank of Japan board member Junko Nakagawa warned of the risk that overseas economies may slow due to bigger-than-expected rate hikes in advanced economies.

“Services prices continued rising in advanced economies and it is still unknown how much central banks raise to tame inflation. In the case of bigger-than-expected rate hikes, real economies will be hit by strongly adverse impact, which will cause big volatility in financial markets and fund outflows from emerging economies,” Nakagawa told business leaders in Fukushima City.

Nakagawa also said that she is paying attention to how wage hikes among major firms that exceed inflation will expand to smaller companies.

“Looking ahead, I expect wages to rise accompanied by an improvement of the economy. But there is high uncertainty regarding how much wages will rise,” she warned.