Speaking before the Japanese Finance Committee on Tuesday, Bank of Japan Governor Kazuo Ueda said:-
- The Japanese economy is showing some weakness, but it is recovering moderately.
- The chance of strong wage growth is growing this year.
- Inflation is likely to exceed 2% this fiscal year, and then slow down after that.
- Forex, market developments and their impact on the economy and prices should be monitored.
- The inflation trend is likely to gradually accelerate by the end of the current forecast period according to the quarterly report.
- The Bank of Japan will appropriately guide policy with a focus on the economy and price developments with the short-term interest rate set as the policy objective.
- The Bank of Japan expects accommodative monetary conditions to continue for the time being.
- Consumption is expected to increase gradually as wage gains lead to an increase in household income.
- Temporary factors affecting consumption are likely to dissipate.
- It is important to maintain accommodative monetary conditions as the inflation trend has not yet reached 2%.
- If economic developments and prices continue as we expect now, we need to think about reducing the degree of monetary support, and if this happens, it will depend on the upcoming data.
- We have no predetermined idea now about how and when we will adjust the levels of interest rates.
- Even after the policy shift in March, we expect that interest rates will remain low, and real interest rates will remain in negative territory.
- We expect to reduce bond purchases in the future, but we cannot say now when and by what volume.
- I will not comment specifically on forex levels, moves.
- There are various factors behind forex movements.
- Foreign exchange rates should move stably, reflecting the fundamentals.
- Monetary policy is among the fundamental factors affecting the movements of foreign currencies.
- Monetary policy does not explicitly seek to control the movements of foreign currencies.
