Keio University's Shirai on BOJ Policy Outlook

The video discusses the current inflation situation in Tokyo, primarily driven by food prices, and the pressure it places on the Bank of Japan (BOJ) to adjust its monetary policy. It explores the dynamics between supply-driven and demand-driven inflation, highlighting concerns about the sustainability of inflation above the BOJ's 2% target. Market participants anticipate potential changes in the BOJ's yield curve control (YCC) policy, while Governor Hueda emphasizes the importance of achieving stable inflation. The video concludes with speculation on the timing and nature of future BOJ policy adjustments.

How does the current situation in the bond market affect the Bank of Japan's decisions?

What mixed messages are conveyed regarding the normalization of monetary policy?

What are the implications of the current inflation trends for future monetary policy adjustments?