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TOKYO (MNI) - Bank of Japan Governor Haruhiko Kuroda said Friday that he
sees no need to review either the policy framework and the 2% price target now.
"I think the proposals by the IMF (International Monetary Fund) is rational
but I don't think it is necessary for the BOJ to review the policy framework
now," Kuroda told lawmakers.
He added that it is premature to discuss an exit of the easy policy as
Japan hasn't yet achieved the 2% price target.
"The BOJ will review as needed, including an exit strategy from the easy
policy. But reviewing the policy framework isn't necessary now," Kuroda said.
The IMF has previously called on the BOJ to introduce an inflation target
range, instead of the current 2% price target, to increase the flexibility of
monetary policy, but Kuroda was dismissive.
"The 2% target is a global standard. Central banks in major industrialized
nations are aiming at achieving the 2% price target. If a central bank adopts
inflation target range, it would be interpreted to mean that the bank aims at
achieving the lower end of the target range," Kuroda said.
He added, that shortening the long-term interest rate target from 10-year
rate, as suggested by the IMF, could be possible in the future "but I have no
idea of changing it now."
Kuroda added that the BOJ is managing monetary policy in a balanced manner,
while carefully monitoring both effects and costs of easy policy.
The IMF's 2019 Article IV consultation for Japan said in November 2019 that
the BOJ could consider shifting its Japanese government bond target from the
10-year note to shorter maturity bonds so as to mitigate the impact of prolonged
easy policy on profits at financial institutions.
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