BOJ raises its GDP forecasts but lowers its CPI forecasts

From today’s Bank of Japan policy meeting outcome:

  • median core CPI forecast for fiscal 2019/20 at +0.6% vs +0.7% projected previously
  • median core CPI forecast for fiscal 2020/21 at +1.0% vs +1.1% projected previously
  • median core CPI forecast for fiscal 2021/22 at +1.4% vs +1.5% projected previously

Growth:

  • median real GDP forecast for fiscal 2019/20 at 0.8% vs +0.6% previously projected
  • median real GDP forecast for fiscal 2020/21 at 0.8% vs +0.7% previously projected
  • for 2021/22 GDP forecast is +1.1% (vs. +1.0% previously)
The thing to keep in mind is that while they are a little more optimistic on growth the CPI is still well below target … thus policy will be loose for some time to come.