BoJ’s Kuroda: Once 2% inflation target is consistently met, will consider exiting ultra-loose policy
|Bank of Japan (BoJ) Governor Haruhiko Kuroda made some comments on exiting its ultra-loose monetary policy during his appearance on Tuesday.
Additional comments
BoJ has acknowledged upside inflationary risks.
Japan likely to see wages rise in next year's wage negotiations reflecting the underlying rise in inflation heightening medium-, and long-term inflation expectations.
Rise in labour productivity likely to lead to higher real wage growth in the long run.
Even if wages rise by 3%, the BoJ will maintain its current easy policy until inflation reaches 2%.
Premature to reveal options on how to unwind BoJ’s ETF holdings.
If BoJ’s price target is achieved, BoJ’s board will likely debate fate of etf holdings as part of its exit strategy from ultra-loose policy.
When BoJ were to sell ETFs, it will do so in a way that minimises BoJ’s losses, avoid causing disruptions in markets.
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