BOJ policymakers divided on wage, inflation outlook, Jan meeting summary shows

BOJ policymakers divided on wage, inflation outlook, Jan meeting summary shows

By Leika Kihara

TOKYO (Reuters) – Bank of Japan policymakers debated the inflation outlook at their January meeting, with some warning that it could take time for wages to rise sustainably, a summary of opinions at their meeting showed on Thursday.

While some board members saw heightening prospects of rising inflation, others said price growth will begin to slow and keep achievement of the BOJs 2% inflation target distant, the summary showed.

“Companies are becoming more keen on raising prices and wages. This could generate a positive cycle between the economy and prices, driven by increases in corporate profits,” one board member was quoted as saying.

But another opinion in the summary said that some firms were cautious about raising pay. “It will take time for wages to rise sustainably, so macro-economic support is necessary,” according to the opinion in the summary.

At the January meeting, the BOJ kept ultra-low interest rates unchanged but beefed up a monetary policy tool to prevent the 10-year bond yield from breaching its 0.5% cap set just a month ago.

The summary lists the opinions of the BOJs nine board members, but does not disclose who made them.

(Reporting by Leika Kihara; Editing by Muralikumar Anantharaman & Shri Navaratnam)

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