The price for rice in Japan’s supermarkets has almost doubled within one year. A five-kilo bag-the common lot size for the rice-loving Japanese-now costs an average of 4077 yen (25 euros). The prices for some vegetables and other foods have recently risen significantly, so that even the Japanese central bank is now warning of the risks of the price increases. Standing food prices would usually be seen as a offer shock that could neglect monetary policy, said central bank governor Kazuo Ueda on Wednesday at the press conference on the latest interest decision by the bank of the bank on Wednesday Japan. “But the long -lasting increase in travel prices means that the risk that these increases influence the inflation expectations and the public mood cannot be neglected. Therefore we have to carefully observe these risks.” Although the price increases are largely due to weather and other factors, they could influence the underflation on the basis of consumer mood and inflation expectations. Among other things, the large automotive groups such as Toyota, Honda and Nissan import a large part of their cars sold in the USA, either directly from Japan or from works in Mexico and Canada. You could sensitively hit Trumps for the duties announced for the tariffs announced from 25 percent on imported cars. With the scope and speed of the US tariffs, there were quick changes last month, said Ueda in Tokyo. “We will see exactly how US trade policy develops, how it influences the USA and other economies and how all this Japan’s economic and prospect shapes.” Important aspects of this remained unclear to April, so that the uncertainty was great. Rendes at the highest level for almost two and a half decades of this environment, the central bank left the interest on Wednesday at 0.5 percent. After the central bank council had raised the interest on this level that had not been extinguished since 2008 at its previous meeting in January, the markets were generally expected to take a break. The yen had grown towards the dollar for the first time in four weak years since the beginning of the year, but has recently lost impetus again. A break in a course at the Japanese bond market has also fed doubts as to whether the central bank may have to take a next step. Investors expect a further reduction in the return curve between the USA and Japan. The returns of 10 years of government bonds rose to 1.515 percent on Wednesday. Ueda emphasized that the time for the central bank was not to interfere in the bond market. His statements from Wednesday evaluated economists in Tokyo as a sign that further interest rate increases will follow. However, most of them do not expect this at the next meeting in early May. “Japan’s wage and price development are on schedule and may be stronger than expected. But the uncertain view in the USA and worldwide make it difficult to estimate the potential effects,” said Ueda. “Therefore, we would like to wait for the upcoming data in early April to reconsider our forecasts.” Ueda not only has the immediate episodes for Japan’s export companies in mind. If consumer prices in the United States rise due to the tariffs, this could also reduce the loss of consumption of the Americans. Some data already indicated this, said Ueda. More on the topic of the mood of the Japanese consumers, the central bank governor also saw positive signals. Above all, the wage negotiations that are traditionally conducted in Japan before the start of the new fiscal year in April were confident that the cycle of price increases and wage increases continued. “The result of the wage negotiations last week was a little stronger than expected,” said Ueda. Unlike previously feared, not only would employees in the large corporations benefit from wage increases, but also more and more those in smaller companies.
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