Key facts
- Underlying inflation is "quite close" to the Bank of Japan's 2% target.
- Strong global AI demand is boosting capital expenditure and exports.
- Inflationary pressures are also coming from Japan's economic recovery and tight job market.
Bank of Japan Governor Kazuo Ueda stated on Monday that underlying inflation is "quite close" to the central bank's 2% target. Speaking in parliament, Ueda highlighted that robust global demand for artificial intelligence is stimulating domestic capital expenditure and exports. This, he noted, is contributing to inflationary pressures alongside Japan's moderate economic recovery and a tight labor market.
