BoJ’s Nakaso says more easing possible if price trends show needJune 9, 2016
BoJ’s Nakaso says more easing possible if price trends show need
Investing.com – Bank of Japan Deputy Governor Hiroshi Nakaso Thursday repeated the underlying price trend is improving, while suggesting the stimulative effect of its negative interest rate policy is being watched and more monetary easing is possible in order to achieve the 2% inflation target.
“The underlying trend in inflation has continued to improve,” he told business leaders in northern Japan, adding that “this doesn’t preclude additional monetary easing if necessary.”
“The output gap is expected to move into positive territory and gradually increase further from the second half of fiscal 2016.”
“Thus, upward pressure on wages and prices due to the tightening of supply and demand conditions is likely to steadily increase,” he said.
Data released last month by the BoJ showed the CPI minus volatile fresh food ande nergy, which the bank believes shows a clearer price trend amid low crude oil
prices, rose 0.9% on year in April, with the pace of increase decelerating from +1.1% seen in the previous three months.
As well, the Consumer Confidence Survey showed the public’s inflation expectations fell sharply in May, the first drop in three months.