It Takes Time To Change Deflationary Mindset (a lot)

  • To maintain the 2013 joint statement with govt; plan to complete new 5-year term
  • BOJ to consider the economy at each policy meeting and make the proper choices
  • Reiterates that BOJ has not reached the point to consider an exit
  • Reiterates view that too soon a discussion on exit could confuse the market
  • Interest rate and balance sheet will be an issue at any exit; tools and sequence could change over time
  • BOJ has the tools to exit and keep market stable
  • Reiterates view that 2nd phase of planned tax hike likely smaller compared to 1st phase back in 2014
  • No need to be worried over potential economic bust following the 2020 Olympics
  • Will carefully watch the impact of trade policy; protectionism could harm one own economy
  • Whittle Down Stimulus To Create Policy Room To Address Future Growth Slowdown Would Be Inappropriate
  • On Talks With PM Abe; Says There Were No Specific Discussions On Further Easing
  • Setting BoJ’s Price Target At 2% Inflation Was Not A Mistake, no need to change BOJ stance now
  • 2% inflation target s a global stance contributing to FX stability
  • Any Exit To Be Gradual, With Cautious Steps

Kuroda at the start of his second 5 year term repeats his well known lines.This is the first time he mentions the risk after the 2020 Olympics, my fear era for Japan.

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