TOKYO (CNA) – Japan’s central bank is not debating an exit from ultra-loose monetary policy, Governor Haruhiko Kuroda said, and will not do so during the rest of his term through April 2023, the Mainichi newspaper reported yesterday.
“As long as our current price projection lives, there’s no chance we will debate (an exit policy),” the paper quoted Kuroda as saying in an interview.
“We’re not engaging in any debate of an exit. Doing so is inappropriate given Japan’s price developments.”
While rising fuel costs are pushing up wholesale prices, the chance of Japan’s consumer inflation accelerating sharply was “very small” as households have yet to become tolerant of price hikes, Kuroda said.
“The key would be wage growth,” he added, arguing that steady increases in wages would be crucial for consumer inflation to sustainably head toward the Bank of Japan’s (BOJ) two-per-cent target.
“Japan’s economic recovery is slower than that of the United States (US) and European countries, and (consumer) inflation is just 0.5 per cent,” Kuroda was quoted as saying.
“As such, there’s no need to scale back monetary stimulus or shift toward policy tightening. Doing so is unlikely,” he added.