Bank of Japan chief vows 'bold' monetary easing
The Bank of Japan’s new chief said on Tuesday that policymakers would live up to market expectations for “bold” monetary easing, ahead of his first policy meeting since taking up the post last month.
The two-day meeting, which starts Wednesday, comes as BoJ Governor Haruhiko Kuroda has repeatedly talked up his plans to stoke the economy and reverse years of deflation that has crimped private spending and corporate investment.
“It is not easy to break out of 15 years of deflation,” he told a parliamentary committee on Tuesday.
But “it is important that we show a strong commitment to mobilising all the policy measures that the Bank of Japan has and doing everything possible, and that we explain this to markets appropriately” to stoke growth.
“I will adopt bold monetary easing policies that would meet (market) expectations,” he added.
Kuroda’s pledges to beat Japan’s long-running deflation has stoked speculation that the BoJ will launch a new wave of aggressive policy measures that tend to weaken the yen, helping the country’s exporters.
The finance veteran and former head of the Manila-based Asia Development Bank also laid out a plan to hit an ambitious two-per cent inflation target adopted by the bank in January, seen as more explicit than a previous “goal”.
Japan “must achieve” the target “as soon as possible”, Kuroda said, adding that he was eyeing a two-year timeframe that some observers have said was unlikely given the country’s long struggle with falling prices.
Prime Minister Shinzo Abe, who took office in December, has pushed for big government spending and called for aggressive monetary easing by the BoJ to breathe new life into the world’s third-largest economy.
Markets have cheered so-called “Abenomics” in recent months, with Tokyo’s benchmark Nikkei 225 index soaring while the yen weakened on forex markets.