Some BOJ Board Members Cautious on Price Outlook

The Bank of Japan maintained its unprecedented easing and forecast inflation will reach its target, even as some board members cautioned that the price outlook was too optimistic.

Governor Haruhiko Kuroda’s board stuck with a pledge to expand the monetary base by 60 trillion to 70 trillion yen ($711 billion) a year, in a decision in Tokyo today. Japan will see average inflation of 1.9 percent in the 2015 fiscal year, according to the board’s median forecast, which strips out the effect of sales-tax increases — the same forecast as in July, a separate statement showed.

Takehiro Sato, Takahide Kiuchi and Sayuri Shirai opposed the wording of the price outlook and voted against the report, highlighting the risk that mixed messages from within the board will make it harder for Kuroda to maintain confidence in the campaign to stamp out deflation. While yen weakness and higher energy prices have countered deflation, a 0.7 percent increase in the BOJ’s key price gauge last month showed that the goal of 2 percent inflation remains distant.


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