Failure to Hit Price Goal May Trigger BOJ Shift, Momma Says
- Ex-BOJ director says policy reconsideration may come in a year
- Most orthodox path would be to ditch YCC, negative rates
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The Bank of Japan is more likely to adjust policy after failing to achieve its inflation goal rather than in response to the current cost-push inflation, according to a former executive director in charge of monetary policy.
“There is a considerable chance that in a year or so the BOJ’s topic of discussion will shift to when the price target can be really achieved” after failing to hit its goal despite global inflation, former director Kazuo Momma said in an interview Thursday. “That could prompt the BOJ to rethink how it should keep stimulus in place while mitigating side effects.”