MNI BRIEF: BOJ To Add Phone Fees In Aggregate CPI Forecast

The Bank of Japan is considering including recently lowered mobile phone charges in its forecast of the consumer price index after aggregating forecasts of individual board members based on staff estimates but it will make clear that any impact will be temporary and sectoral, MNI understands.

The BOJ is of the view that lower phone charges will increase real purchasing power. Bank officials don't expect the reductions to change inflation expectations or the underlying CPI trend although they will be monitoring the impact closely. The BOJ board's median inflation forecast this fiscal year is expected to be revised down slightly from +0.5% in January.

The government hasn't disclosed how lower mobile phone charges will be reflected in CPI. The reduced fees, which took effect in April, will be incorporated into Tokyo CPI, which is due April 30 after the BOJ meeting on April 26-27 and its outlook report.