The Bank of Japan (BoJ) Governor Kazuo Ueda spoke on Monday at the Japan Business Federation meeting. Ueda said that the possibility of achieving the central bank's inflation target was gradually rising, and it would consider adjusting policy if prospects of sustainably achieving the 2% target increased sufficiently.

Key quotes

“Service prices gradually accelerating pace of increase, though it seems many firms feel it is not easy to pass on rising labour costs.”

“If positive wage-inflation cycle strengthens, and heightens prospects of sustainably achieving price target sufficiently, we will consider changing monetary policy.”

“We can not pre-set timing of future policy change, but will like to make an appropriate decision while scrutinizing economic developments, firms' wage and price-setting behaviour.”

“In an economy where positive inflation is sustained, nominal rates will be high and give central bank scope to cut interest rates sharply when necessary.”

“When monetary policy functions effectively, that means the risk of economy worsening sharply or returning to deflation will diminish.”

“BOJ patiently maintaining monetary easing to ensure signs of change in firms' wage, price-setting behavior is sustained.”

“BOJ will carefully examine economic developments, including whether positive wage-inflation cycle will strengthen, and make an appropriate decision towards sustainably hitting price target.”

“It may take some time but upward pressure from past rises in import prices will likely gradually ease.”

"We will carefully examine economic developments as well as firms' wage- and price-setting behavior, and thereby decide on future monetary policy in an appropriate manner