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BOJ’s Kuroda faces heat for saying people are beginning to accept price rises

Bank of Japan Governor Haruhiko Kuroda. (AFP)
Bank of Japan Governor Haruhiko Kuroda. (AFP)
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07 Jun 2022 04:06:29 GMT9
07 Jun 2022 04:06:29 GMT9

Bank of Japan Governor Haruhiko Kuroda faced political heat on Tuesday for a remark a day earlier that households were becoming more accepting of price rises, underscoring public sensitivity to rising living costs.

Opposition lawmaker Kenji Katsube, one of several politicians who questioned Kuroda in parliament, said the remark showed how the governor “did not understand how the public feels” about price rises.

“It deviates somewhat from reality,” Trade Minister Koichi Hagiuda was quoted by Kyodo news agency as telling reporters when asked about Kuroda’s comments.

They came at a sensitive time for Prime Minister Fumio Kishida’s administration, which faces growing calls to deal with rising fuel and food costs ahead of an upper house election next month.

The remark also drew a flurry of criticism on social media, with many people using the hashtag “we can’t accept price increases” to share their comments.

“We’re buying goods because they are daily necessities, not because we’re accepting” higher prices, wrote one user. “Everyone is under pain.”

Another wrote: “Only wealthy people like you were able to save during the coronavirus pandemic.”

While conceding the wording may have been inappropriate, Kuroda said on Tuesday the remark was made in the context of explaining the need for wages to grow more.

“We aren’t just aiming to raise prices. We instead want to create a positive cycle where prices rise in tandem with stronger wage growth and economic activity,” he said.

Japan’s core consumer prices were 2.1% higher in April than a year earlier, exceeding the BOJ’s inflation target for the first time in seven years, due largely to rising fuel and food prices.

BOJ officials have repeatedly said such cost-push inflation will be temporary and will not trigger a withdrawal of monetary stimulus.

Reuters

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