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BOJ walks fine line as it faces the wrong kind of inflation

Japan could bleed over $100bn a year from crude, yen headwinds, Daiwa says

Though a weak yen can be a boon for Japan's economy, which relies heavily on exports, it also increases the price of imports in the country in a blow to households and businesses alike.   © Reuters

TOKYO -- The Bank of Japan will stay the course on monetary easing even as it predicts inflation will approach its 2% target in April, with costlier commodities and a weak yen doing more to raise consumer prices than years of BOJ efforts.

"There are extremely high uncertainties over how the situation surrounding Ukraine will affect Japan's economic activity and prices," the BOJ said in a statement following its policy meeting Friday.

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