Bank of Japan Governor Haruhiko Kuroda said that the central bank could add to its unprecedented monetary easing announced two months ago should economic conditions change significantly.
The April 4 package could be expanded or reduced as needed, Kuroda told lawmakers today. The BOJ said in its latest statement that it will make policy adjustments “as appropriate.” In April, Kuroda said that policy makers had done everything “necessary” and “possible” to counter deflation and spur growth.
While the BOJ has laid out a two-year plan for doubling the monetary base, that doesn’t mean that no further actions will be taken over that period, Kuroda told parliament today. Economists including Naohiko Baba, chief Japan economist at Goldman Sachs Group Inc., have said the BOJ could expand easing in October, when price forecasts will indicate whether progress has been made towards achieving a goal of 2 percent inflation.
“The policy we decided on April 4, we are not saying that we will not change it for two years, and if the economic or financial situation changes significantly, and what we decided on April 4 was insufficient, or was too much, we would adjust up or down,” Kuroda said.
A policy statement this month restated the April pledge to increase the monetary base by 60 trillion to 70 trillion yen ($736 billion) per year.
To contact the reporters on this story: Keiko Ujikane in Tokyo at email@example.com; Norihiko Kosaka in Tokyo at firstname.lastname@example.org
To contact the editor responsible for this story: Paul Panckhurst at email@example.com