Inflation expectations of Japanese companies climbed in December from three months ago, data from the Bank of Japan tankan survey showed, as reported by Reuters Dec. 18.
Companies surveyed by the BOJ expect consumer prices to increase 0.8% a year from now, up from a 0.7% increase three months ago. These also expect consumer prices to rise an annual 1.1% three years from now and 1.1% five years ahead, similar to results obtained three months ago, the quarterly survey on corporate inflation expectations showed.
Japan's economy expanded an annualized 2.5% in the July-September period but consumer inflation is at 0.8%, still below the central bank target of 2%.
The heightened inflation expectations among businesses comes on the back of a BOJ tankan survey released last week, which showed business sentiment among large manufacturers rising to an 11-year high.
Both surveys will be factored in by the BOJ board when it meets for its scheduled rate review on Dec. 20 to Dec. 21, Reuters said.
The BOJ has hinted of an earlier-than-expected exit from extraordinary monetary stimulus amid mounting concerns on the high costs of prolonged easing.