This file photo shows the head office of the Bank of Japan in Tokyo. (Mainichi)

       TOKYO (Kyodo) -- Japan's economy will likely see a pent-up demand but reducing monetary stimulus to cope with accelerating inflation will not be an option for the Bank of Japan for the time being, a board member said Thursday.

       Asahi Noguchi, a supporter of reflationary monetary policy, said in a speech that he expects the economic recovery will become more pronounced at the end of this year or later as vaccinations progress and the impact of COVID-19 is expected to wane gradually.

       Some countries like the United States have seen inflation accelerating in line with the reopening of their economies that has led demand suppressed by COVID-19 restrictions to recover. The U.S. Federal Reserve is expected to start tapering its crisis-mode stimulus as early as November with financial markets focused on when it will raise interest rates.

       "The bottom line is, in the case of Japan, reducing monetary easing in response to rising inflation as some central banks are about to do will not be an option for the time being," said Noguchi, who became a member of the BOJ's Policy Board in April, during a virtual meeting with business leaders in Tottori Prefecture, southwestern Japan.

       "That is because the precondition for the Bank of Japan to reduce monetary easing is nothing but the fact that the inflation rate continues to be above 2 percent in a stable manner," he said.

       Japan's core consumer price index excluding volatile fresh food items, a gauge of inflation was flat in August, still far from the BOJ's goal of 2 percent.

       With inflation low before the spread of COVID-19 hit the Japanese economy, the pace of growth in wages and inflation is unlikely to be as rapid as some other countries even as some of "excessive savings" accumulated during the pandemic will go to spending, Noguchi said.

       "In Japan, the challenge is to keep the momentum for an expansion in pent-up demand going through continued monetary easing so that this momentum will lead to our efforts to achieve 2 percent price stability target," he said.

       He also cautioned against downside risks to the economy from supply chain disruptions that have hit automakers due to surging COVID-19 cases in Southeast Asia.

       Even if the spread of COVID-19 is contained, Noguchi said it will take a substantial amount of time until the BOJ can reduce monetary easing.

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