Inflation Expected to Rise Above BOJ’s Target Range

• BOJ’s October 2020 survey indicated expected inflation of 6.3% for the calendar year 2020, which is higher than the October 2020 CPI outturn of 5.0%. The expected inflation 12 months ahead decreased to 6.7% relative to the previous survey outturn of 7.0%.
• The perception of inflation control declined slightly in the October 2020 survey relative to the September 2020 survey.
• The majority of respondents continued to believe that the Bank’s policy rate will remain the same over the next three months.
• The Present Business Conditions Index reflected a lower level of optimism while the Future Business Conditions Index illustrated a sharp increase in optimism compared to the previous survey.

(Source: BOJ)