Bank of America: Expectations for inflation in Japan may further increase.

Bank of America Merrill Lynch stated in a research report that inflation expectations in Japan may continue to rise, providing support for the Bank of Japan's gradual path to interest rate hikes. They pointed out that Bank of America's comprehensive inflation expectation indicator for Japan continued to rise in the first quarter. Bank of America expects that the rise in energy prices starting this summer will push up actual inflation and inflation expectations, strengthening the case for gradual interest rate hikes. They stated that the Bank of Japan is likely to maintain a trend towards further rate hikes in the medium term.