BOJ board member Takahide Kiuchi

  • Japan's economy continues to recover moderately
  • Consumption likely to remain firm, capex seen continuing moderate increase
  • Exports picking up, albeit with some fluctuations
  • China's economy sustaining stable growth as a trend, though excess capacity, property market adjustment weighing on growth
  • Growth in emerging economies slowing as a whole due partly to China's slowdown
  • Hard to sustainably heighten long-term inflation expectations with BOJ's policy commitment alone given global dis-inflationary trend
  • I am particularly vigilant of risk BOJ's huge asset buying could distort market functions and potentially trigger financial system instability
  • BOJ cannot buy government bonds unlimitedly so question may arise in future on how long it can keep buying them
  • My proposal to taper asset buying doesn't mean balance of BOJ's JGB holdings will diminish
  • Difficult to achieve 2 pct inflation with monetary policy alone as that is a level inconsistent with Japan economy's true strength
  • Maintaining excessive monetary stimulus to push up inflation above economy's strength in short period of time could hurt economic, price stability

(I would have guessed that hurting price stability was the whole point. Anyway more from Kiuchi ....)

  • My proposal to taper asset buying could be first step toward shifting toward a more flexible policy combining various tools, including zero interest rate policy
  • Chance of Japan's inflation hitting 2 pct by fiscal 2017/18 is low

Headlines via Reuters

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Unsurprisingly, Kiuchis is less gung-ho on easing than other members of the BOJ board. I noted this earlier, so these comments are not of much surprise.

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More from Kiuchi later at a press conference at 0530GMT

Kiuchi likes long walks on the beach and dissenting at Bank of Japan board meetings