Bank of Japan Governor Ueda Kazuo (植田 和男) said underlying inflation was approaching the 2% target and that global AI demand was intensifying upward pressure on prices. Markets are focused on the outlook ahead of the monetary policy meeting later this month and are awaiting clues on the timing of the next rate hike.
Bank of Japan Governor Ueda Kazuo (植田 和男) said underlying inflation had come quite close to the 2% target. He also said global demand for artificial intelligence was adding to upward pressure on prices from tight labor-market conditions. Reuters reported his remarks.
The remarks came ahead of a key monetary policy meeting by the central bank scheduled for the end of the month, where new quarterly growth and inflation forecasts are expected to be released. Markets are watching for clues on the timing of the next rate hike.
Governor Ueda said higher raw-material costs resulting from the conflict in the Middle East were pushing up inflation, while tight employment conditions and the slow pace of the economic recovery were generating demand-driven price increases. He said AI demand was boosting capital investment and exports and was also contributing to higher goods prices.