BOJ Warns of Inflation Exceeding Target Amid Rising Corporate Wages

Bank of Japan Governor Kazuo Uetani warned that inflation may exceed the 2% target, citing rising corporate wages and pricing behavior. He emphasized that stabilizing price trends around 2% is a core policy goal.

The governor stated that the strong demand for artificial intelligence, recent rebound in oil prices, and continued weakness of the yen have driven producer prices to remain high, supporting inflation continuation.

Uetani also mentioned three major external variables influencing future interest rate directions: the Middle East situation, AI demand expansion, and yen exchange rate trend. He pointed out that due to these factors' combined effects, Japan's producer prices are currently at a high level, adding inflationary pressure.