MNI BRIEF: Updated CPI Base Year Unlikely To Factor In BOJ Forecasts

A regular five-year change in the base year for the consumer price index in Japan to 2020 from 2015 is unlikely to factor in Bank of Japan inflation forecasts, but will point out to downward pressure on the CPI this fiscal year, MNI understands.

The government will increase the weight of low mobile phone charges this year, which will be available on July 9.

However, the government will not disclose what kind of phone charges that it uses of calculating the CPI, making it difficult for BOJ economists to calculate the impact. As well, travel costs last year fell for accommodations under a a government travel campaign, and questions remain on whether the campaign will resume after a state of emergency to curb COVID-19 cases is lifted.

But the BOJ board's median forecast for inflation rate is expected to be revised down slightly from +0.1% made in April on July 16 when the BOJ holds its policy meeting and releases the quarterly Outlook Report.