Bank of Japan (BoJ) Governor Kazuo Ueda said on Friday that the Japanense Yen (JPY) weakness is increasingly feeding into import costs and consumer inflation, adding that currency swings have a bigger impact than in the past.

Key quotes

Compared with past, companies are becoming more keen to raise wages and prices.

Against such backdrop, foreign exchange moves could have bigger impact on prices.  

We must also be mindful of the chance foreign exchange moves could affect inflation expectations, underlying inflation.

Will scrutinize impact of foreign exchange volatility on prices.

Our basic stance is to continue raising interest rates if economy and prices move in line with forecast.

Prospects of our projections materializing increasing.

We decided to keep policy steady to spend a bit more time to confirm whether firms active wage-setting behaviour will not be disrupted.

We are still at a stage where we need to scrutinize this point, especially initial momentum of next year's wage talks

We want to make use at next meeting and onward information we gather including form surveys collected by our branches nationwide.

We will debate timing and likelihood of rate hike at upcoming policy meeting by scrutinising various data.

Market reaction

As of writing, the USD/JPY pair is down 0.21% on the day at 157.25.