MNI: BOJ Kuroda: Delinking 2% CPI Timing From Easing Spec

     TOKYO (MNI) - Bank of Japan Governor Haruhiko Kuroda on Friday said the BOJ

has stopped publishing its estimate on when it can achieve the 2% inflation

target in order to "dispel the misunderstanding" among some market participants

that a delayed timing would prompt the bank to conduct additional easing.

     But Kuroda also told a news conference that the BOJ's commitment to

anchoring 2% inflation "as early as possible" is unchanged and that the bank

will "patiently" maintain large-scale monetary easing to achieve the target.

     At its two-day policy meeting that ended earlier Friday, the BOJ board

decided in an 8-to-1 vote to maintain its cautiously stimulative monetary easing

stance under the yield curve control framework while dropping its estimate on

when it can achieve the increasingly evasive 2% inflation target in the

quarterly Outlook Report.

     While noting the path to 2% inflation is intact, Kuroda said long-term

inflation expectations among businesses and households remain weak.

     The recent improvement in the output gap will lead to higher consumer

prices, which then should lift inflation expectations and actual prices, he

said.

     "Short-term inflation expectations are rising slightly but medium- to

long-term inflation expectations haven't moved," Kuroda said.

     By removing the reference to the timeframe for 2% inflation, the BOJ does

not have to keep pushing it back as price rises remain subdued.

     The BOJ has pushed back the timeframe of hitting the 2% price target six

times since it launched aggressive easing five years ago. Until recently, its

estimate was that Japan could anchor 2% inflation "around fiscal 2019."

     Kuroda said the board's decision to drop the reference does not mean the

BOJ will change the way it conducts monetary policy.

--MNI Tokyo Bureau; tel: +81 90-2175-0040; email: hiroshi.inoue@marketnews.com

--MNI Tokyo Bureau; tel: +81 90-4670-5309; email: max.sato@marketnews.com

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