Japan's Economy Minister Downplays Inflation Risks Despite BOJ Warning

Japan's Economy Minister Minoru Kiuchi expressed optimism about inflationary risks on Tuesday, stating that consumer price rises have been moderate so far. The overall Consumer Price Index (CPI) rose 1.7% year-on-year in June.

Kiuchi acknowledged the potential for higher costs to be passed onto food and other consumer goods from summer through autumn, but emphasized the government's focus on cushioning the hit to households with fuel subsidies.

The assessment contrasts with that of the Bank of Japan (BOJ), which warned last week about the risks of inflation overshooting its 2% target. Kiuchi has attended the BOJ's recent policy meetings and expressed his views, including signaling reservations over the central bank's rate-hike plans.