BOJ flags broadening price, wage hikes in wake of policy tweak
People walk in front of the bank of Japan building in Tokyo, Japan, April 7, 2023. REUTERS/Androniki Christodoulou//File photo
TOKYO – Price hikes have spread rapidly among Japanese companies and sectors that had previously been cautious about passing on costs to households, the Bank of Japan (BOJ) said on Monday.
“We must continue to scrutinize whether price hikes to pass on higher costs could broaden and last longer,” the central bank said in a full version of its quarterly outlook report.
Companies are becoming increasingly open to raising wages, the BOJ said, stressing the need to look at how such moves could affect the outlook for inflation.
The BOJ revised up this year’s inflation forecast at a summary of its outlook report released on Friday, but left its price projections for fiscal 2024 and 2025 largely unchanged.
The assessment on the price and wage outlook came after the central bank’s decision on Friday to tweak its bond yield control policy and allow long-term interest rates to rise in line with inflation.
RELATED STORIES:
Japan firms offer biggest pay hikes in 30 years, wage growth broadens
Japan’s changing views on price hikes open door for BOJ policy tweak
