MNI BRIEF: BOJ Recovery, Exports, Production View Unchanged

The Bank of Japan board Friday left its overall economic assessment unchanged, noting the country's economy had picked up, "despite being affected by factors such as past high commodity prices.”

The BOJ also maintained the near-term economic recovery scenario, but warned it expects downward pressure due to past high commodity prices and a slowdown in the pace of recovery overseas. The Bank repeated that the y/y rate of increase in CPI (all items less fresh food) will likely decelerate toward the middle of fiscal 2023, but did not say the rise would fall below its 2% target. It also left its near-term outlook unhanged, noting the economy will likely recover moderately toward around the middle of fiscal 2023.

The BOJ also left its assessment on major economic components – exports, production and private consumption – unchanged. “Inflation expectations have been more or less unchanged recently after rising,” the Board said.

The central Bank repeated its past risk assessment of “there remains extremely high uncertainties for Japan's economy, including the following: 'developments in overseas economic activity and prices'; developments in the situation surrounding Ukraine, and in commodity prices.”