Bank of Japan policy board member Ayano Sato said firms are increasingly passing
higher costs to consumers and the BOJ must guard against potential inflationary
effects from yen depreciation. She said monetary policy should focus on
inflation while fiscal policy should support households and firms hit by rising
prices. Appointed by dovish Prime Minister Sanae Takaichi, Sato declined to
comment on the timing or pace of further rate hikes and said the BOJ must watch
both downside growth risks and upside inflation risks.
