TOKYO (AFP)
Japan's central bank on Tuesday sharply hiked its inflation forecasts for the current year and halved its growth projections.
Officials also held off hiking interest rates again, having last done so in December, though observers pointed out a significant split in the decision that could mean they will rise before the end of the year.
The Bank of Japan (BoJ) said it expected consumer prices to rise 2.8 percent in the current fiscal year, compared with the 1.9 percent previously forecast, while it lifted the next year's outlook to 2.3 percent from 2.0 percent.
The increase for consumer inflation, except for fresh food, is "significantly higher" and for fiscal 2027 "somewhat higher, reflecting the effects of the rise in crude oil prices," the BoJ said.
It also slashed its fiscal 2026 growth forecast to 0.5 percent from 1.0 percent, and for next year trimmed its projection to 0.7 percent from 0.8 percent.
The Federal Reserve and the European Central Bank are also expected to keep their main borrowing rates unchanged at meetings this week.