Free Trial

MNI BRIEF: BOJ To Keep Easy Policy Amid 'Temporary' Price Gain

(MNI) Tokyo
TOKYO (MNI)

The Bank of Japan will stick to easy policy if consumer prices rise above 2% in or after April if the gains are seen as temporary and not accompanied by higher wages, MNI understands.

Bank officials expect upward pressure on the CPI from high crude oil prices to slow eventually, though high uncertainties continue. In the meantime, continued easy policy is seen as needed to offset a weaker economy that would make it harder to reach the goal of a 2% sustained rise in prices driven by economic recovery and higher wages, see: MNI INSIGHT: Few BOJ Tools As Weak Yen Drives 'Bad' Prices Up.

Bank officials note government efforts such as subsidies for petrol prices and other support that can cushion the current impact and set the stage for a rebound based on pent-up demand. The BOJ releases its latest policy views on Friday.

MNI Tokyo Bureau | +81 90-2175-0040 | hiroshi.inoue@marketnews.com
MNI Tokyo Bureau | +81 90-2175-0040 | hiroshi.inoue@marketnews.com

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.