BOJ Ups Inflation Forecast; Policy Kept Unchanged

Economy Politics

Tokyo, July 21 (Jiji Press)--The Bank of Japan on Thursday raised its growth forecast for Japan's core consumer price index for fiscal 2022 to 2.3 pct from the 1.9 pct estimated in April while deciding to keep its current ultraeasy monetary policy unchanged.

The upward revision of the CPI forecast, shown in the BOJ's quarterly Outlook for Economic Activity and Prices report, which was adopted at the bank's two-day Policy Board meeting through the day, reflected higher energy and materials prices attributable to Russia's invasion of Ukraine as well as the impact of the yen's recent rapid weakening.

The BOJ's inflation forecast topped 2 pct for the first time since comparable data became available in fiscal 2003, except for fiscal 2014, when prices in the nation rose due to the consumption tax hike from 8 pct to 10 pct.

If the revised forecast for fiscal 2022 comes true, the BOJ would achieve its 2 pct inflation target on a fiscal year basis.

The central bank also raised its growth projection for the core CPI, which excludes fresh food prices, to 1.4 pct from 1.1 pct for fiscal 2023 and to 1.3 pct from 1.1 pct for fiscal 2024.

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