Sources: BOJ may raise inflation forecasts but will keep interest rates unchanged.

PANews October 20 news: According to four people familiar with the matter, the Bank of Japan may raise its inflation outlook for the next fiscal year in its forecast to be released this month, because rising oil prices are putting more persistent price pressure on the economy than expected. The sources said that, given that the Bank of Japan just raised interest rates last month, it is expected to keep rates unchanged at its two-day policy meeting ending on October 30, unless the yen exchange rate falls sharply again, thereby pushing up import costs and overall inflation. However, the sources said the Bank of Japan may continue to emphasize growing inflation risks in its quarterly report released after the meeting, which also leaves room for another rate hike as early as December. One of the sources pointed out: "Consumer price growth may persist longer than expected, although underlying inflation has not changed significantly." Two other sources expressed the same view.