MNI BRIEF: BOJ Keeps CPI View; Price Risk Balanced

The Bank of Japan on Thursday left its core consumer price index forecasts for fiscal 2025, 2026 and 2027 unchanged at 2.7%, 1.8% and 2.0%, following the Board's decision to leave the policy rate unchanged at 0.5%. 

The Bank also maintained its assessment that “risks to prices are generally balanced.” (See MNI POLICY: BOJ Board Likely To Maintain Price View)

On the economy, it said “risks to economic activity are skewed to the downside for fiscal 2026.”

The BOJ revised up its median GDP growth forecast for fiscal 2025 to 0.7% from 0.6% in July, while leaving projections for fiscal 2026 and 2027 unchanged at 0.7% and 1.0%.

The Bank largely maintained its economic view, saying, “Japan’s economic growth is likely to be modest, as trade and other policies in each jurisdiction lead to a slowdown in overseas economies and to a decline in domestic corporate profits, although factors such as accommodative financial conditions are expected to provide support.”

Market participants are focused on how Governor Kazuo Ueda will refer to the timing of a possible rate hike at the post-meeting press conference from 15:30 JST (0630 GMT).