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Japan's economy has recovered moderately, although some weakness has been seen in part. It is likely to keep growing at a pace above its potential growth rate, as a virtuous cycle from income to spending gradually intensifies. Upward revisions have been observed in the outlook for overseas economies overall, particularly for the U.S. economy. Although private consumption has been relatively weak, reflecting price rises, it is likely to regain momentum, given that momentum in wage hikes has been strong recently. If firms postpone business fixed investment due to factors such as supply-side constraints, this could lead them to lose business opportunities and hinder improvement in their productivity, and in turn create a risk that firms will not be able to secure enough resources for wage hikes. Therefore, attention is warranted on developments in business fixed investment. While the output gap has been at around 0 percent, the weighted average of the diffusion indexes (DIs) for production capacity and employment conditions in the Tankan (Short-Term Economic Survey of Enterprises in Japan) indicates that shortages of production capacity and labor have been at historically high levels. In determining whether Japan's economy will keep growing steadily at a pace above its potential growth rate throughout the projection period, it post: BOJ MEMBER SUGGESTS RATE PATH MAY BE HIGHER THAN MARKET EXPECTATIONS. post: BOJ MEMBER EMPHASIZES NEED FOR APPROPRIATE RATE INCREASE AT THE RIGHT TIME
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The Bank of England’s Monetary Policy Committee (MPC) sets monetary policy to meet the 2% inflation target, and in a way that helps to sustain growth and employment. At its meeting ending on 8 May 2024, the MPC voted by a majority of 7–2 to maintain Bank Rate at 5.25%. Two members preferred to reduce Bank Rate by 0.25 percentage points, to 5%. The ...
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