BOJ removes time frame for inflation goal

April 27, 2018

Tokyo- The Bank of Japan removed the time frame for achieving its 2 percent inflation goal from its quarterly economic and price outlook report while keeping its massive monetary easing policy unchanged on Friday.

The central bank previously said that 2 percent inflation would be achieved around fiscal 2019, which ends in March 2020.

In its latest report, released after a two-day monetary policy meeting, the BOJ said that prices suggest greater downside risks than upside potential.

The momentum for achieving the 2 percent inflation goal is maintained but "not yet sufficiently firm, and thus developments in prices continue to warrant careful attention," the bank said.

The BOJ said it expects Japan's core consumer prices, excluding fresh food prices, to rise 1.8 percent in fiscal 2020, excluding the impact of a planned consumption tax increase in October 2019.

The bank cut its fiscal 2018 consumer inflation outlook to a 1.3 percent rise from the previous forecast for a 1.4 percent increase. The fiscal 2019 estimate was kept unchanged at a 1.8 percent rise.

At the meeting, the BOJ's nine-member policy board voted 8-1 to continue guiding 10-year Japanese government bond yields to around zero and maintain the policy rate of minus 0.1 percent applied to part of commercial financial institutions' current account deposits at the bank.

The BOJ maintained its basic assessment of the country's economy, saying that it is "expanding moderately."

The bank said the country's economy is projected to grow 0.8 percent in fiscal 2020. It cited the effects of the consumption tax increase as one of the economy's risk factors.

It was the first policy meeting since BOJ Governor Haruhiko Kuroda started his second five-year term earlier this month. Jiji Press