Bank of Japan Governor Kazuo Ueda indicated he saw little need to alter its monetary stimulus ahead of his first policy meeting as the bank’s chief, forecasting underlying inflation to weaken.
(Bloomberg) — Bank of Japan Governor Kazuo Ueda indicated he saw little need to alter its monetary stimulus ahead of his first policy meeting as the bank’s chief, forecasting underlying inflation to weaken.
“Our stance is to continue with monetary stimulus along with our price outlook,” Ueda said in response to questions in parliament Monday. The bank concludes its two-day meeting on Friday, when it will also publish its quarterly economic projections. “Inflation is expected to cool to below 2% in the second half of this fiscal year” ending in March 2024, he added.
The remarks support expectations among most BOJ watchers for no major shift this week. While some see the possibility of adjustments to its yield curve control policy, Ueda said the bank wasn’t at a stage to discuss tweaking it.
BOJ officials are wary of tweaking or scrapping their yield control stimulus so soon after the banking crisis overseas, people familiar with the matter told Bloomberg last week.
Data on Friday showed Japan’s consumer prices excluding fresh food and energy gained the most since 1981. Speaking for the first time in public since the data, Ueda said that that the inflation reading was expected to soon slow down.
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