BOJ Maintains Inflation Warning with Slightly Eased Tone

The Bank of Japan (BOJ) is set to maintain its warning on inflation overshooting the 2% target at next week's policy meeting, but with a noticeably less urgent tone than three months ago.

This shift in tone reflects a reduced concern about the immediate oil shock and an increased focus on how much firms are passing rising costs onto households, rather than just the direct impact of the Middle East conflict.

The BOJ's rates are expected to stay at 1% at the July 30-31 meeting, with some analysts predicting a rate hike to 1.25% between October and December.