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04/08/26
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Japan Minister Says Inflation Not Yet Fully Passed to Consumers
Japan’s economy minister, Minoru Kiuchi, said on Tuesday that the broader impact of higher goods costs has not yet been fully passed through to consumers. He said the government and the Bank of Japan are continuing to coordinate closely as they seek to secure a stable and sustainable 2% inflation rate.
Kiuchi pointed to June’s overall consumer price data as evidence that price increases remain moderate on a year-on-year basis. Even so, he warned that policymakers need to remain alert to the possibility that food-related cost pressures could continue to feed into prices from the summer into the autumn.
He said the government shares the central bank’s view that inflation is likely to quicken in the second half of the year before easing later on. The minister added that monetary policy should be conducted in a way that supports a durable return to the BoJ’s inflation target, while maintaining close communication between the bank and the government.
Kiuchi also said he would not comment on any specific exchange-rate level, but emphasized that authorities are monitoring the effects of foreign-exchange movements on the broader economy and on prices. His remarks did not trigger an immediate move in the yen.
At the time of writing, the dollar was trading near ¥157.65, close to the session high. The currency market has been sensitive to signals about inflation, policy timing, and the pace of further normalization by the Bank of Japan.
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