Core consumer prices of Japan increased 0.5% in December from a year earlier. The increase is for a second month in a row at the fastest pace in nearly two years.
Rising inflation in Japan is primarily accounted to rising fuel and raw material costs.
Some policymakers before inter rate-setting meeting said, some firms might have started being more aggressive to pass on the extra cost to consumers.
“It’s unlikely Japan will see wages rise as sharply as in the United States. But there’s a significant chance both economic growth and inflation could overshoot expectations,” one BOJ board member was quoted as saying in the meeting.