The Bank of Japan is widely expected to leave its policy rate unchanged at a two-day meeting from Thursday, a month after implementing a hike for the first time in 17 years, though a persistently weak yen is raising the prospect of higher inflation driven by import costs.
Bank of Japan chief Kazuo Ueda says he is still not confident the nation can attain the central bank's 2 percent inflation target on the back of wage growth, amid growing speculation the BOJ is nearing a decision to scale back its powerful monetary easing policy.
The Bank of Japan faces a difficult monetary policy decision at its two-day meeting beginning Monday, as the yen could further weaken if a policy tweak is not delivered as is expected by some in the financial markets.
Bank of Japan Governor Kazuo Ueda on Friday warned of the "extremely high" cost of premature monetary tightening that would dampen prospects of attaining a stable 2 percent inflation rate, as he made his case for persisting with the current ultralow rate policy.