Tokyo, Oct. 30 (Jiji Press)--The Bank of Japan showed a view Friday that the country's underlying inflation has reached its 2 pct target, marking a new phase in its monetary policy nearly 14 years after it first set the inflation goal and launched large-scale monetary easing.

The central bank expressed this assessment of inflation excluding temporary factors in its quarterly Outlook for Economic Activity and Prices report, adopted at its two-day policy meeting that ended the same day.

Underlying consumer price index inflation "is at a level that is generally consistent with the (BOJ's) price stability target of 2 pct and is expected to remain at around that level," the bank said in the report.

The BOJ is set to shift its focus to curbing inflationary pressures to stabilize the inflation rate at around the target, saying, "It will be important, from the perspective of sustainable and stable achievement of the price stability target, to examine the degree to which underlying CPI inflation is anchored at a level around 2 pct."

At the Policy Board meeting, the BOJ decided by an 8-1 vote to maintain its policy of guiding the unsecured overnight call rate, Japan's benchmark short-term interbank rate, to around 1.25 pct. Having raised the policy rate to the current level at its previous policy meeting in September, the bank opted to stay put this time to assess the effects of the hike on the economy, prices and corporate loans for now.

The Bank of Japan's Policy Board holds a monetary policy meeting at the central bank's head office in Tokyo on Friday. (Pool photo)
Bank of Japan Governor Kazuo Ueda heads for a monetary policy meeting at the central bank's head office in Tokyo on Friday. (Pool photo)

[Copyright The Jiji Press, Ltd.]