BOJ’s Kuroda promises to maintain an ultra-loose policy

DAVOS, Switzerland (Reuters). Haruhikokuroda, Bank of Japan Governor said Friday that the central bank would continue its current “extremely accommodative monetary policies” in order to achieve its 2% inflation target. This will be done in a stable and long-term manner.

“Our hope is for wages to start rising, which could help us meet our 2% inflation target in a stable and sustained manner. He said that we must wait for a while at the World Economic Forum’s annual meeting.

Kuroda claimed that the BOJ’s decision of widening the band around the 10-year bond yield target was “perfectly just”, ignoring criticisms about market distortions. Instead, Kuroda encouraged speculation about further tweaks to the yield curve control (YCC).

Japan’s core consumer price indexes rose 4.0% in December from last year, more than double the central banking’s 2% target. The new 41-year-high was a market record and keeps alive market expectations that the central Bank could end ultra-low interest rates.

Kuroda explained that December’s increase in inflation was due to rising import costs. Kuroda added that consumer inflation will likely begin to slow in February and average less than 2% for the fiscal year beginning in April.

He said that the BOJ and the government had been successful in changing Japan’s economy structure and growth prospects.

He said that the 2% inflation target was not being met in a sustainable and stable way. Kuroda stated that his only regret was his decade-long tenure at the BOJ’s helm, which will be ending in April.

(Reporting by Mark John; additional reporting by Leika in Tokyo; Editing and editing by Peter Graff

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