Bank of Japan Gov. Kazuo Ueda said that while his nation’s inflation rate has reached policymakers’ target, it’s unclear how long it will stay there, and indicated it hasn’t yet become embedded among the broader Japanese public.
“Underlying inflation is 2% — our goal is to keep it there,” Ueda said in a question and answer session after delivering a speech at the International Monetary Fund in Washington on Friday. “I think we are in equilibrium,” he said. “Whether we could stay in that equilibrium for a very long time to come, we still don’t know.”
The remarks come a week after the BOJ marked a milestone by declaring that underlying inflation had reached the bank’s 2% target for the first time since the goal was introduced in 2013. Ueda didn’t offer any specific guidance on the central bank’s appetite to raise interest rates further, in an exchange with IMF Managing Director Kristalina Georgieva.
