- Kozo Yamamoto, Liberal Democratic Party lawmaker
According to the latest minutes from the Bank of Japan, policymakers are determined to keep the current pace of the monetary policy for the foreseeable future, meaning the stimulus programme that was launched in April 2013 is far from its conclusion. It is not a surprise for anyone that central bank's governor, Haruhiko Kuroda, is extremely confident about the economic future and economy's ability to meet its inflation target within the planned period. However, he still has to persuade other BoJ board members that they have the power to meet its obligations.
People familiar with the central bank's thinking stressed out that a majority of the nine members do not share Kuroda's confidence about flooding the economy with enormous amount of cash will be sufficient to get stable 2% growth in consumer prices. Some of the members are convinced that that cannot be done without government steps to increase the country's growth potential, which is currently limited around 1% per year. Some even say that the ideological gap is masked in public remarks by board members and that is why lawmakers are still calling for legislation that will force the Bank of Japan to be responsible for delivering on its target. This week's inflation data can only heat up these speculations, especially if a report fails to deliver.
© Dukascopy Bank SA