BOJ PRESS CONFERENCE: BoJ Governor Ueda says Japan's economy is recovering moderately, albeit with some weakness

MIDDLE EAST

Need to pay attention to further developments.
Global markets are volatile, crude jumped significantly after rising tensions.
Important to watch impact of Middle East development on domestic economy.
Will check to what extent surging oil prices would affect the economy.
Before the war, conflict showed solid business and household activity.
Slight majority of Board Members had the view that upward pressure on prices was higher given the war in the Middle East.
Personally, Ueda wants more time to decide whether Middle East situation has an upward or downward impact on prices.
Secondary impact from supply shock can lead to broad-based price hikes.

INFLATION

The pace of inflation increase expected to face upward pressure from higher oil prices.
Trend inflation will become more difficult to read.
It would be hard to measure CPI trends.
Will conduct more thorough explanation on CPI going forward.
New measures include expanding core CPI indicator and using latest data.
Will check wage trends and corporate price action will sustain momentum.
Inflation can fluctuate to the upside and downside.
Watching spring wage talks.
Cannot say how long it would take to judge whether energy supply shocks affect underlying prices.
Still some distance from the target inflation rate.

APRIL MEETING

Will re-examine central view on prices at April meeting.
Biggest point for April meeting would be whether the median outlook on prices change.
Will explain after the release of the April Tankan report whether they fully capture Middle East.
If there's is a big enough risk, it's possible the BoJ would conduct policy by placing weight on that risk.

MARCH MEETING

Held rates steady this month and out emphasis on lower visibility regarding the likelihood of achieving the inflation target.

Forex has a larger impact on prices and underlying inflation than in the past.
Carefully watching any forex impact on prices

RATES

No change in stance that the timing of future hikes would be looked at every meeting.
Real interest rates are at a significantly low level.
Will continue to raise policy rate if the economic and prices move in line with forecast, and in accordance with improvements in economy and prices.
Currently re-evaluating natural interest rates based on latest data.

RISKS

Middle East, oil prices, and FX markets development - need to pay attention to those risks affecting Japan.
Not of the view that systemic risk situation is occurring in financial systems.

WAGE TALKS

Prelim data shows wage momentum at small and medium sized firms could be better than in past years.
Will turn to Rengo's first round of wage surveys.

JOINT ACTION

There's no specific joint action with global central banks following the Middle East conflict.