TOKYO- Bank of Japan Governor Haruhiko Kuroda said on Wednesday consumer inflation may approach its 2 percent inflation on rising raw material costs, offering his clearest signal to date that upward price pressures will continue to broaden.
But he said the central bank would maintain its ultra-loose monetary policy to ensure any rise in prices would be accompanied by higher wages and a recovery in the economy.
“It’s true there’s a chance consumer inflation will approach 2 percent through various channels,” Kuroda told parliament.
“But what’s desirable is for the economy to recover steadily and push up corporate profits, thereby leading to higher wages and inflation. We’ll patiently maintain ultra-easy policy to achieve this at the earliest date possible,” he said.
Kuroda’s remarks follow those by deputy governor Masayoshi Amamiya, who last week said inflationary pressures were gradually growing in Japan with more firms being able to pass on higher costs to consumers.
Japan has not been immune to the global commodity inflation with wholesale prices rising a record 9.0 percent in November from a year earlier.
But core consumer inflation remains stuck around zero and rose just 0.1 percent in October, as firms remain cautious about passing on costs to consumers on concerns households may hold back on spending. – Reuters
