BoJ board member Naoki Tamura offered insights into the timeline for potentially phasing out the central bank’s ultra-accommodative stance. he signaled that by the first quarter of 2024, BoJ could gather sufficient data to evaluate whether the 2% inflation target could be sustainably achieved.
“It’s appropriate at this stage to sustain monetary easing, and earnestly scrutinize wage and price developments,” Tamura said, adding that he is hopeful for “further clarity” on the inflation target “around January through March next year” through wage and price data available by that time.
Tamura anticipates that Japan’s inflation could slow down for the time being, only to moderately accelerate later. This coincides with his expectation of high wage growth in the next year’s spring wage negotiations.
Tamura emphasized that the “biggest key to monetary policy outlook is whether Japan achieves a positive cycle of rising wages and inflation.”
