Ueda Warns Japan Inflation Could Overshoot BOJ Target
The BOJ governor cited currency swings, Middle East tensions and AI demand as risks ahead of the central bank’s October policy meeting.
Key takeaways
- Ueda warned that underlying inflation in Japan could exceed the BOJ’s 2% target.
- The BOJ will release fresh growth and inflation forecasts at its October 29-30 meeting.
Bank of Japan Governor Kazuo Ueda warned that underlying inflation could exceed the central bank’s 2% target, citing risks including Middle East tensions, AI-related demand and currency swings.
In a speech read by Deputy Governor Shinichi Uchida on Friday, Ueda said keeping underlying inflation anchored around 2% had become more important. He said an overshoot should not harm the economy.
The remarks largely repeated comments Ueda made earlier this month. The BOJ meets on October 29 and 30, when it will release new quarterly growth and inflation forecasts that markets will scrutinize for clues about the timing of its next rate hike.
The central bank raised its key rate to a 31-year high last month and signaled a focus on preventing underlying inflation from overshooting its target.
This article was produced with the help of AI technology. Based on reporting by the outlets listed above.
