BOJ chief says current policy framework is ‘sustainable’

TOKYO (Reuters) – Bank of Japan Governor Haruhiko Kuroda said on Thursday the central bank’s yield curve control was a “sustainable” framework that can push down long-term interest rates efficiently, brushing aside criticism that its huge bond buying was nearing a limit.

Kuroda said the BOJ’s massive stimulus program has ended deflation and boosted the economy and that he expects firms will start to increase wages and help inflation accelerate to the central bank’s 2 percent target.

He said he was aware of concerns among some market players that the BOJ’s huge bond buying could dry up market liquidity and make it difficult for the BOJ to control long-term rates.

“In this respect, the BOJ’s bond buying has been conducted in a smooth manner so far. The risk of us facing problems in terms of buying bonds will be small for the time being,” he said in a speech at a seminar on Thursday.

Kuroda reiterated that the BOJ will continue to “persistently pursue powerful monetary easing” to achieve a well-balanced economic recovery accompanied by stable prices.

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