BoJ to Trim Inflation Forecast

The Bank of Japan is making final arrangements to lower its forecast for the inflation rate this fiscal year from 1.3% to about 1%, while lowering its prediction for fiscal 2019 from 1.8% to the mid-1% range, Kyodo reported. The revisions will be adopted at the central bank’s two-day Monetary Policy Meeting of the Policy Board to be held on Monday and Tuesday. Due to difficulties achieving its 2% inflation target at an early date, the central bank intends to continue its large-scale monetary easing policy. After the meeting, the bank will announce its quarterly Outlook for Economic Activity and Prices report, which will present the outlook for the inflation rate from fiscal 2018 through fiscal 2020. The growth of the consumer price index, which excludes volatile fresh food prices, has lagged since spring, with the CPI in June rising only 0.8% from a year earlier. The number of board members who believe the inflation outlook should be revised downward has increased, as prices have not risen as expected, putting inflation targets further out of reach.