Bank of Japan Governor Haruhiko Kuroda on Friday defended the central bank's decision to widen the trading band in its yield curve control program.
It leaves the BOJ at odds with other major central banks, which have hiked interest rates in a bid to tackle rising inflationary pressure.. The rate is still relatively low when compared to some other countries. Nonetheless, the world's third-largest economy reported core consumer prices rose to 4% on an annualized basis in the final month of last year, double the central bank's target of 2%.
"We expect, probably from February this year, inflation rates start to decline and [in] fiscal year 2023 as a whole, [the] inflation rate will be less than 2%. So, we decided to maintain the current extremely accommodative monetary policy for the time being," Kuroda said, largely attributing rising inflation to an import price hike.
"Our hope is that wages start to rise and that could make [the] 2% inflation target to be met in a stable and sustainable manner, but we have to wait for some time," he added.Alongside bond market turmoil, rising inflation is likely to amplify pressure on Kuroda, who is slated to retire in early April, to end the central bank's ultra-loose monetary policy.
Asked whether he had any regrets during his almost decade-long reign, Kuroda replied, "I think in the last nearly 10 years during which I have been governor of the Bank of Japan we tried to eradicate deflation and that certainly we have been successful in eradicating … And we tried to recover economic growth."
"All in all, I think the government's policy coupled with the Bank of Japan's extremely accommodative monetary policy has been successful in changing the Japanese economic structure and growth prospect, but unfortunately 2% inflation target has not been achieved in a sustainable and stable manner," Kuroda said.
South Africa Latest News, South Africa Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
BoJ Governor Contender Ito: BoJ could widen band around its 10-year yield target by mid-yearTakatoshi Ito, a contender to succeed Bank of Japan (BoJ) Governor Haruhiko Kuroda, said on Thursday that “the BoJ's next step may be to widen band ar
Read more »
Breakingviews - Bank of Japan has learnt danger of half-measuresGovernor Haruhiko Kuroda’s battle with market forces has entered a new phase. The Bank of Japan (BOJ) made no adjustments to its yield-curve control (YCC) policy that keeps interest rates ultra-low on Wednesday. That is stinging traders who bet the central bank would be forced to widen a 10-year government bond’s trading band again, having expanded it to 0.50% from 0.25% in December under market pressure. However, that tweak’s failure to reduce the need of central bank intervention has left the BOJ with little appetite for more compromises.
Read more »
DAVOS 2023 Crypto collapse brings focus to digital assets' 'true value' - ex-India central bank governorThe collapse in the prices of digital assets over the past year will allow investors to focus on the 'true value' of this new technology, the distributed ledger and the smart contracts that can be built on them, former Reserve Bank of India Governor Raghuram Rajan said on Wednesday.
Read more »
Former Indian central bank governor says a soft landing will be 'very hard' for the FedThe U.S. Federal Reserve will find it 'very hard' to engineer an economic soft landing after its cycle of aggressive interest rate hikes, according to former Reserve Bank of India Governor Raghuram Rajan.
Read more »
Bank of Japan has learnt danger of half-measuresThe central bank’s decision to stay put on interest rates saw the yen soften and hurt 10-year bond yields. Last month’s surprise tweak to bond trading bands failed to impress traders. Inaction may be painful and expensive, but muddled economic signals make it understandable.
Read more »
USD/JPY took traders for a ride over Bank of JapanUSD/JPY is down some 0.2% as we head into Tokyo following a turbulent time over the past few session due to the Bank of Japan deliberations that resul
Read more »