Incoming BoJ Governor Kazuo Ueda told the upper house of parliament today, “there’s still some distance for Japan to see inflation sustainably and stably meet the BoJ’s 2% target.”
“Big improvements must be made in Japan’s trend inflation for the BoJ to shift towards monetary tightening,” he said.”It’s not that I have no ideas on how to tweak the BoJ’s current policy. But the desirable tweak will vary depending on economic changes at the time.”
“In guiding monetary policy, central banks must weigh the benefits and costs of each step,” Ueda said. “At present, the benefits of the BoJ’s current policy exceed the costs.”
“There are various side-effects emerging, but the BoJ’s current policy is necessary and appropriate” to achieve its 2% inflation target, he said.
