- BOJ forecasts global slowdown but not severe recession – Ueda
- Japan’s Wages Likely to Continue Rising – Ueda
- Ueda said he had told the G20 BOJ to maintain ultra-lightweight policies
- Ueda will chair the first BOJ policy meeting on April 27-28
WASHINGTON, April 13 (Reuters) – Bank of Japan Governor Kazuo Ueda said he expects the global economy to recover after a period of slowdown, which will help domestic wages keep rising and the optimistic economic outlook of the bank would be maintained.
But Ueda said he had told his G20 peers the central bank intends to keep monetary policy ultra-loose as inflation, now around 3%, is expected to fall back below its 2% target in the second half of this fiscal year .
“The BOJ forecasts already factor in the possibility of a global economic slowdown. But they don’t see a severe global recession as the baseline forecast,” Ueda said at a news conference on Thursday after attending the Group of 20 (G20) financial leaders’ meeting in Washington.
“Since our base case is that global growth picks up after a period of slowdown, Japan’s wages are likely to continue to rise,” he said.
The comments came after the International Monetary Fund cut its global growth outlook for 2023 on Tuesday and warned that a serious flare-up in financial system turmoil could push manufacturing to near recessionary levels.
Ueda said his first international meeting was fruitful and gave him the opportunity to meet with many foreign colleagues, adding that deepening personal trust with them is crucial to participate in open discussions on global economic issues.
Ueda took office on Sunday, succeeding Haruhiko Kuroda, who deployed massive monetary stimulus during his decade-long tenure, which is now being criticized for distorting bond markets and hurting financial institutions’ profits.
While markets have been buzzing with speculation that he will soon be phasing out Kuroda’s stimulus, Ueda has consistently stressed the need to maintain ultra-loose policy until a sustained rise in wages and inflation is foreseen.
Markets are focused on the Ueda-chaired BOJ’s first policy meeting, which will take place on April 27-28, when the board will issue new quarterly growth and inflation forecasts through fiscal 2025.
“I took office just a week ago and am now on a business trip. I will think it over carefully when I return,” said Ueda when asked about the prospects for the political meeting in April.
Reporting by Leika Kihara Editing by Shri Navaratnam
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