The Bank of Japan is considering revising its inflation outlook upward for the current fiscal year to next March, factoring in a bigger-than-expected impact from the yen's sharp drop and higher commodity prices, sources familiar with the matter said Monday.
When the BOJ holds its regular two-day policy meeting next week, it will likely forecast core consumer inflation to rise above 2.5% in fiscal 2022, up from 2.3% projected in July, the sources said.
The central bank is widely expected to maintain its ultralow rate policy as the pace of economic recovery will likely slow down, and the core consumer price index, excluding volatile fresh food items, is seen as undershooting the BOJ's target of 2% in fiscal 2023 and 2024.