Japanese Deputy Economy Minister Yasutoshi Nishimura defended the Bank of Japan’s “aggressive” monetary policy and said the government’s growth strategy includes “unprecedented” measures.
Japan’s central bank “has been equipped to carry out a monetary easing policy comparable to those in other countries,” Nishimura said today in a speech to the U.S.-Japan Research Institute in Washington.
The goal of “Abenomics,” named for Japanese Prime Minister Shinzo Abe, is to “rebuild the economic foundation so that the Japanese economy can break free from long-term deflation and start on a full-fledged path of growth,” Nishimura said. “To do so, we will take some bold, unprecedented steps that will change the landscape we see around us.”
Japan has suffered falling prices in 11 of the last 14 years. The new Bank of Japan governor, Haruhiko Kuroda, this month announced a doubling of monthly bond purchases in a bid to reach 2 percent inflation in two years and revive the world’s third-largest economy.
The yen rose 1.5 percent against the dollar last week to 98.05 per dollar. The currency touched a four-year low of 99.95 on April 11.
Nishimura said “aggressive monetary policy” is part of the “three-pronged strategy of Abenomics” that also includes flexible fiscal policy and stimulating private-sector investment. He said the government projects nominal economic growth of 2.7 percent and real growth of 2.5 percent this year.