Overview

• BOJ Governor Kazuo Ueda reaffirmed the central bank's commitment to raising interest rates if sustained food price increases lead to broader inflation across the economy.
• Japan's core inflation reached 3.0% in February, exceeding the BOJ's 2% target for nearly three years, though largely driven by temporary factors like food and energy costs.
• The BOJ is closely monitoring underlying inflation, which remains slightly below 2%, and wage growth, currently around 3%, as key indicators for sustainable price stability.
• Service-sector inflation hit 3.0% in February, supporting expectations of further rate hikes to address broader inflationary pressures.
• The BOJ's next policy meeting on April 30-May 1 will include updated economic projections, with a focus on the impact of rising food prices on underlying inflation.