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MNI POLICY: BOJ Eyes 2023 CPI As Trigger For Policy Tweaks

(MNI) Tokyo
(MNI) Tokyo

Higher inflation forecasts in April's Outlook Report could prompt early stage discussions about a possible change to its easing bias.

Bank of Japan officials may initiate preliminary discussions about adjusting monetary policy if its 2023 inflation forecast is revised up, laying the groundwork for a possible change in its easing bias after April should its 2% inflation target come into sight, MNI understands.

The BOJ's Outlook Report in April looms as a catalyst for early stage discussions as inflation estimates for the 2023 and 2024 fiscal years will take into account planned price hikes in February by Japanese companies. Officials, which will include a new BOJ governor in April, will also await wages data due after April's report. Whether the expected discussions lead to a guidance change will depend on the sustainability of corporate price hikes and wage increases.

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Bank of Japan officials may initiate preliminary discussions about adjusting monetary policy if its 2023 inflation forecast is revised up, laying the groundwork for a possible change in its easing bias after April should its 2% inflation target come into sight, MNI understands.

The BOJ's Outlook Report in April looms as a catalyst for early stage discussions as inflation estimates for the 2023 and 2024 fiscal years will take into account planned price hikes in February by Japanese companies. Officials, which will include a new BOJ governor in April, will also await wages data due after April's report. Whether the expected discussions lead to a guidance change will depend on the sustainability of corporate price hikes and wage increases.

Keep reading...Show less