BOJ Outlook Report (full version): Japan’s import prices continue to show clear rise

The Bank of Japan (BOJ) publishes its full version of the quarterly outlook report, highlighting that “Japan’s import prices continue to show a clear rise.”

Additional takeaways

Pass-through of rising raw material costs to consumers not spreading to broad range of items.

From short-term perspective, pass-through of raw material costs on consumer inflation appears small.

There is uncertainty on how much firms will pass on rising raw material costs to consumers ahead.

Must be mindful of risk of overshoot in inflation as firms may pass on rising costs to households faster than expected.

Weak yen's effect in boosting export volume has been falling in recent years.

Weak yen's effect in improving Japan’s income balance has been increasing recently.