Investors around the world are waiting for signs that the Bank of Japan is ready to adjust its ultra-easing policy and start raising interest rates.
Central bank Governor Ueda Kazuo has reiterated that achieving sustainable inflation of 2 percent is still the main consideration.
The BOJ has stressed that the 2 percent target must be accompanied by wage increases. But Ueda told reporters on Thursday that he is not targeting wage growth itself.
Ueda said: ''If prices continue to increase by 2 percent in a sustainable and stable manner, wages will naturally rise. So when making policy decisions, we must see whether consumer prices are rising sustainably and stably by 2 percent.''
Ueda said he expects inflation to slow down before picking up again. He said he needs to continue monitoring the situation closely.
Wage growth will still be key to achieving the BOJ's goal.
Ueda said that the central bank will examine whether pay increases are sustainable and widespread. It will base its assessment on data including wage statistics, labor supply and demand, as well as reports from BOJ branches across the country.
Ueda also indicated that the BOJ may scale back monetary easing even if the inflation rate is below exactly two percent. He said it is more important to see whether the increase is sustainable and stable rather than focusing on the number to the first decimal place.