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MNI BRIEF: BOJ Tweaks Consumption, Capex Assessment

(MNI) Tokyo

The Bank of Japan board on Tuesday left its assessment on the current economic climate but tweaked its assessment on private consumption and capital investment, which both recently fell.

The BOJ repeated, “Japan’s economy has recovered moderately” and Japan’s economy is likely to continue recovering moderately for the time being, supported by factors such as the materialisation of pent-up demand, although it is expected to be under downward pressure stemming from a slowdown in the pace of recovery in overseas economies.

“Private consumption has continued to increase moderately, despite being affected by price rises,” the BOJ noted. The previous view was that private consumption has increased “steadily” at a moderate pace.

“Business fixed investment has been on a moderate increasing trend,” the BOJ added. The previous view was that business fixed investment has increased moderately. “Inflation expectations have risen moderately,” the bank stated.

As for the price view, the BOJ said the y/y rate of increase in the CPI (all items less fresh food) will likely print above 2% through fiscal 2024 due to the remaining effects of the pass-through to consumer prices of cost increases led by the past rise in import prices.

However, it said the rate of increase will likely decelerate as these these factors dissapate.

MNI Tokyo Bureau | +81 90-2175-0040 |
MNI Tokyo Bureau | +81 90-2175-0040 |

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