BOJ Governor Kurodas comments at news conference

div classBodysc17zpet90 cdBBJodivpReuters – The Bank of Japan on Thursday doubled down on its commitment to maintain its massive stimulus programme and a pledge to keep interest rates ultralow, triggering a fresh selloff in the yen and sending government bonds rallying.p

pReinforcing its resolve to support a fragile economy even as sharp rises in raw material costs push up inflation, the BOJ also said it will offer to buy unlimited amounts of 10year government bonds to defend an implicit 0.25 cap around its zero target every market day.pdivdivdiv classBodysc17zpet90 cdBBJodiv

pThe BOJ‘s commitment to its zerorate programme puts it at odds with major economies that are shifting towards tighter monetary policy, although inflation in Japan is expected to creep up towards the central bank’s 2 target.p

pFollowing are excerpts from BOJ Governor Haruhiko Kurodas comments at his postmeeting news conference, which was conducted in Japanese, as translated by Reuters:p

pTHE YENS DECLINEp

p“Its desirable for currencies to move stably in a way that reflects economic fundamentals. The kind of rapid moves seen in a short period of time heightens uncertainty for companies and makes it difficult for them to set business plans.”p

p“We haven‘t changed our view that a weak yen is positive for Japan’s economy as a whole. But its also true that excessive currency volatility would heighten uncertainty for companies … and would be unfavourable for the economy.”p

pPRICE OUTLOOK AND MONETARY POLICYp

p“When excluding energy and volatile food prices, consumer inflation will likely gradually accelerate and hit 1.5 in fiscal 2024. But that‘s still below our 2 target. When including energy, our core consumer inflation forecast is for a 1.1 gain in fiscal 2024. I don’t think well see a stage where we can seek an exit from our easy monetary policy.”p

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pp Reporting by Leika Kihara editing by Uttaresh.Vp

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