Japan to witness only a limited reacceleration towards the inflation target in 2017 – Goldman Sachs

Analysts at Goldman Sachs suspect only a limited reacceleration, with inflation still below 1% for the year. 

Key Quotes

“We have been skeptical of the prospects for the BOJ’s 2% inflation target to be reached anytime soon and remain so in 2017.14. Indeed, with core inflation (ex fresh food) just at -0.4% currently, getting to 1% would already be a meaningful achievement.  Large further increases in commodity prices and/or yen depreciation could boost CPI inflation slightly, but would be unlikely to change this basic assessment.  Our forecasts suggest core inflation will remain slightly below 0.5%.”