Japan inflation way off target (again): BOJ expected to maintain unrealistic forecast
The Bank of Japan monetary policy meeting is on April 26 and 27 (preview!)
In addition to the policy announcement Friday the BOJ will release the results of its quarterly review of its growth and price forecasts. While growth has picked up, inflation is still missing target. We just got the March inflation data: Japan March CPI data: Headline clocks in at 1.1% y/y (expected 1.1%)
- The underlying rate of inflation came in at 0.5% (compared to the BOJ target at 2%)
'Sources' say that in the forecasts next week the Bank will likely maintain its view inflation will reach its 2% target next fiscal year (FY 2019 begins in April 2019), and that inflation will stay near that level the following year (FY 2020).
Reuters say "sources familiar with" BOJ thinking
- "The economy is sustaining momentum for inflation to reach 2 percent. But the pick-up in inflation remains modest," said one of the sources, a view echoed by two other sources.
- "The key would be how quickly inflation expectations will heighten, which remains uncertain," another source said.
Do I need to add that the BOJ has been saying it'll hit the target for many years now, shifting the date further out from time-to-time? Maybe this time will be different and I will have my nose rubbed in the headline to this post."Is this on the record?"