Japan's consumer inflation likely to slow back below 2% next fiscal year

Bank of Japan Governor Haruhiko Kuroda said on Thursday that Japan's economy is picking up and is likely to recover as the impact of supply constraints and the pandemic eases. 

Key quotes

Japan's economy is likely to recover as the impact of supply constraints, pandemic eases.
    
Uncertainty regarding Japan's economy is extremely high,
    
Must be vigilant to the impact of fx, market moves on the economy, and prices.
    
BoJ will maintain an easy monetary policy to sustainably, and stably achieve 2% inflation accompanied by wage growth.
    
Japan's consumer inflation is likely to slow back below 2% next fiscal year.

Japan's consumer inflation recently exceeded 2% but that is almost entirely driven by firms passing on rising import costs to consumers.
    
Must leave room for policy response to ensure japan never returns to deflation.
    
We may be seeing slight signs of change in firms' cautious sentiment that was behind prolonged deflation.

More to come...