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By Leika Kihara <\/p>\n
TOKYO, Aug 4 (Reuters) – Japan has seen only moderate rises in consumer prices so far with the pass-through \u200cof higher costs from the Middle East conflict remaining \u200climited, Economy Minister Minoru Kiuchi said on Tuesday, offering a sanguine view on inflationary \u200brisks. <\/p>\n
The assessment contrasts with that of the Bank of Japan, which last week issued its strongest warning to date on the risks of inflation overshooting its 2% target. <\/p>\n
“The overall consumer price index rose 1.7% year-on-year \u200cin June, showing only \u2060moderate rises,” Kiuchi told a news conference, when asked about the BOJ’s warning. <\/p>\n
“We do need to be vigilant \u2060to the possibility that costs could be gradually passed onto food and other consumer goods from summer through autumn,” he added. <\/p>\n
But average real wages \u200bare expected \u200bto increase nearly 1% during \u200bthe current fiscal year ending \u200cin March 2027, Kiuchi said, stressing the government’s focus on cushioning the hit to households from rising inflation through fuel subsidies. <\/p>\n
“We hope the BOJ continues to guide appropriate policy to stably and sustainably achieve its 2% inflation target,” said Kiuchi, who is known as an \u200cadvocate of loose monetary policy. <\/p>\n
Kiuchi has attended \u200bthe BOJ’s recent policy meetings including last \u200bweek and in June, \u200bwhen the central bank raised interest rates to a \u200c31-year high of 1%. <\/p>\n
At the \u200bJune meeting, Kiuchi said \u200bthe BOJ must be held accountable for its decision and respond nimbly if the economy faced “extreme volatility,” a summary of \u200bopinions at the meeting \u200cshowed, remarks markets saw as signalling the government’s reservations over \u200bthe central bank’s rate-hike plans. <\/p>\n
(Reporting by Leika Kihara; Editing \u200bby Christian Schmollinger and Shri Navaratnam) <\/p>\n<\/p><\/div>\n