Bank of Japan to continue monetary easing so far

Haruhiko Kuroda, BOJ’s governor, said the central bank will continue monetary easing to provide timely economic support and ensure steady inflation accompanied by rising wages in the country. 

During a meeting with business leaders in Nagoya, central Japan, Kuroda announced its plan to maintain economic growth. So, further monetary stimulus is needed, Reuters reported. 

As opposed to its counterparts, i.e. US and European banks, advocating for monetary tightening to combat high inflation rates, Japan’s economy is still struggling to recover from the COVID. The country is seeing an output gap. 

The Bank of Japan is keeping interest rates ultra-low. The regulator also expressed its dovish stance at the last meeting in October, where discussions on the right course for the central bank took place. 

Kuroda said the country's consumer inflation has reached 3% over 2022. It is expected to moderate to 1.5% next year. The reason would be lower global commodity prices, reducing inflationary pressures on the country's economy from import costs. 

However, the outlook for Japan is still ambiguous. There are some factors affecting the country's economy, including currency movements, global trade market dynamics, and other triggers.

As Kuroda stated, companies have long been reluctant to increase prices. These measures have become a necessity over time. 

Thus, according to the BOJ’s head, pricing mechanisms in Japan are crucial, so placing them at the forefront is important.