Bank of Japan policy board member Nakamura:
- Japan's economy recovering moderately albeit some weak signs
- My view is that inflation may not reach 2% from fiscal 2025 onward if consumption weakens
- Will focus on whether inflation-adjusted consumption turns positive, in deciding future monetary policy
- Based on current data, it is appropriate to keep policy intact for time being
- Pass-through of wages to inflation remains weak but closely monitoring situation
- Households' purchasing power is weak, solid rise in disposable income is needed for households to boost spending
- Personally not confident that wage growth will be sustained
- Want to check whether capex growth will become broad-based, as some smaller firms appear to be delaying investment due to supply constraints
- Hard to believe companies, which had focused on cost cuts for 30 years, would suddenly change their mindset in 2 years
- Structural changes in economy are necessary for Japan to sustainably, stably achieve BOJ's 2% inflation target
- Pace of overseas economic recovery slowing, uncertainty remains high
- Japan's consumption has recently been sluggish
I bolded ... a lot of the comments. These seem indicative of easy policy remaining in place for the time being.
The BOJ meet next week, June 13 and 14.
BoJ Nakamura