Overall risks to the Japanese economy on the whole are balanced, Bank of Japan Policy Board Member Sayuri Shirai said Thursday. But the central bank should pay greater attention when consumption tax is raised, she said.
In a speech to business leaders in Asahikawa, northern Japan, she said consumption tax should be introduced as scheduled from April 2014 but she expressed concern about the possibility of the actual inflation projected for fiscal 2014 exceeding the rate anticipated by households.
The revision in tax with price increases may lead to a decline in the real household income. "The risks are tilted somewhat to the downside, particularly with regard to the responsiveness of prices to the output gap," Shirai added.
She expects markets to stabilize over time. "The Bank continues to closely monitor market developments within a flexible operational framework and through discussions with market participants, and it expects that both short- and long-term interest rates will move largely on a stable path," Shirai said.
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June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.