Ueda States Domestic Wage-Inflation Cycle Is Still Somewhat Weak

Governor Ueda's appearance before parliament is not showing any dramatic shift relative to recent comments. The Governor is stressing that inflation is expected to rise over the medium to longer term, but only gradually. He add Japan is still some distance to the 2% inflation target (BBG)

• Higher inflation outcomes recently have been driven by cost-push factors, but such pressures are expected to dissipate (RTRS).
• The domestic wage-inflation cycle is still somewhat weak, but is gradually taking place (BBG).
• Ueda noted the potential side-effects from YCC include FX volatility, but he reiterated the well-worn desire for FX markets to move in a stable manner.
• Since Ueda starting speaking, USD/JPY has firmed, close to 150.60 (Tuesday highs at 150.69 aren't too far away), but note broader USD sentiment has firmed as well.
• JGB futures have been relatively steady, currently at 144.58, +.24.