Many Bank of Japan board members shared the view in April that wage gains and inflation in the country remain “relatively weak” despite improving economic conditions, minutes of their policy meeting that month showed Wednesday.
The situation underlines the task facing the central bank in its push to achieve its 2 percent inflation target, showing the lack of progress made despite the drastic monetary easing measures already implemented. Core consumer prices excluding fresh foods turned positive in January but remain near zero percent.
While some board members pointed to price competition among mobile phone carriers as a drag on gains in core consumer prices, many said even excluding such factors, increases in wages and prices were weak relative to other economic factors, the minutes of the April 26-27 meeting showed.
The BOJ cut its inflation outlook for fiscal 2017 at the meeting, expecting consumer prices to rise 1.4 percent from a year earlier, down from the 1.5-percent forecast.
Board members otherwise shared an optimistic view on the domestic economy, saying the positive cycle led by exports and production is “becoming firmer” and labor market conditions had been tightening steadily, the minutes said.
Regarding overseas economies, the members agreed that their “growth momentum had strengthened further on the whole, as advanced economies continued to recover steadily” and the renewed growth in exports and production was spreading among Asia’s emerging economies.
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