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The Bank of Japan maintained its ultra-loose monetary policy on Friday and downgraded its view on inflation in a fresh blow to its long-held 2 percent price goal, further complicating the central bank’s path to rolling back its crisis-era stimulus.

Following are comments from BOJ Governor Haruhiko Kuroda at his post-meeting news conference:


“It’s true year-on-year growth in consumer prices is slowing. This is partly due to falling durable goods prices blamed on past yen rises and temporary fluctuations in hotel costs. But more companies, particularly in the service industry, are passing on rising costs to consumers. Companies’ price-setting behavior appears to be changing. The economy is sustaining momentum to achieve the BOJ’s 2 percent inflation target.”

“The board will engage in further debate on price moves at its next rate review in July, when it issues its quarterly long-term forecasts.”

“While there may be a need to deepen debate (on why inflation remains subdued), but there’s no plan now to conduct another comprehensive review on price developments.”


“Each country must opt for the best monetary policy in light of its economic and price conditions. Japan’s economy is seeing labor markets tighten and the output gap improving, but prices aren’t rising much. As such, it’s most appropriate to patiently maintain our powerful monetary easing.”

“There are some factors seen in the United States and Europe that are keeping inflation in Japan subdued. On top of that, there are factors unique to Japan that are weighing on inflation. That’s the deflationary mindset of households and companies, which became entrenched due to 15 years of deflation.”

“Short-term inflation expectations tend to move in response to underlying price moves. But medium- and long-term inflation expectations aren’t rising much. That’s due to Japan’s deflationary mindset.”

“Service-sector productivity in Japan has been low compared with that of the United States and Europe. As companies streamline operations via IT investment, productivity is rising and that may be keeping prices from rising much. Non-manufacturers’ productivity is rising quite rapidly in Japan. This is good for the economy in long-term but may prevent prices from rising much in the short run.”


“The government’s debt balance is very high, so it’s important that the government makes efforts to maintain market trust in its finances.”


“Core consumer inflation is moving around 0.5 to 1 percent, still distant from our 2 percent target. It’s premature to talk about specific means and procedures for an exit. What’s important now is to do our best to achieve 2 percent inflation. When the appropriate time comes, the BOJ is ready to offer appropriate communication to markets.”