BoJ Expected to Raise Fiscal 2026 Growth Forecast While Maintaining Inflation Vigilance

The Bank of Japan is likely to raise its fiscal 2026 GDP growth forecast in July’s Q2 report while maintaining focus on inflation risks, with monetary policy specifics left to the BoJ.

The Bank of Japan is anticipated to revise upward its GDP growth forecast for fiscal 2026 in the upcoming Q2 report scheduled for release in July, according to FX Street.

Despite this optimistic revision, the central bank will continue to monitor inflation risks closely, with concerns about inflation potentially overshooting the BoJ’s target remaining a key focus, Reuters cited by FX Street reported.

Japan’s Chief Cabinet Secretary Minoru Kihara emphasized that specific monetary policy decisions will remain under the purview of the Bank of Japan, signaling no immediate changes ahead. This cautious stance reflects ongoing challenges for Japan’s markets as they navigate inflation dynamics amid a delicate economic recovery.

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By Sama Kane

Tokyo Overnight

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