Japan Carefully Watching Markets, Sumita Says

The Bank of Japan is carefully watching the recent rapid rise of the Tokyo stock and yen bond markets for their impact on inflation, governor Satoshi Sumita said.

In a statement to the bank’s regional branch managers, Sumita said the central bank was particularly monitoring the markets because of the recent rapid growth of money supply. He said he is also carefully watching real estate prices.

Sumita said he expects money supply growth to remain high from April through June. In March, money supply, as measured by M-2 plus certificates of deposit, rose at a year-on-year rate of nine pct.