The International Monetary Fund supports the Bank of Japan in normalizing monetary policy, and said that if inflation increases beyond expectations, the central bank may need to speed up the pace of austerity. In an interview on the sidelines of the IMF's annual meeting in Bangkok, IMF Asia Pacific Director Krishna Srinivasan said that the Bank of Japan “is taking the right actions.” “If inflation rises faster than expected, it is necessary to speed up policy tightening to prevent inflation expectations from becoming unanchored,” he said. “It depends on the data.” Srinivasan also called on Japan to clarify the sources of fiscal expenditure and introduce a medium-term fiscal framework to ease market concerns about the country's debt risk.

The International Monetary Fund supports the Bank of Japan in normalizing monetary policy, and said that if inflation increases beyond expectations, the central bank may need to speed up the pace of austerity. In an interview on the sidelines of the IMF's annual meeting in Bangkok, IMF Asia Pacific Director Krishna Srinivasan said that the Bank of Japan “is taking the right actions.” “If inflation rises faster than expected, it is necessary to speed up policy tightening to prevent inflation expectations from becoming unanchored,” he said. “It depends on the data.” Srinivasan also called on Japan to clarify the sources of fiscal expenditure and introduce a medium-term fiscal framework to ease market concerns about the country's debt risk.