INTERVIEW: 2 Pct Inflation Hard to Achieve

Economy Politics

Tokyo, Sept. 20 (Jiji Press)--The Bank of Japan's target of 2 pct inflation is hard to achieve with monetary policy alone, former BOJ executive Kazuo Monma has said.

"What has become clear through the BOJ's continuance of massive monetary easing is that a shortage of money is not the cause of the country's deflation," said Monma, currently executive economist at Mizuho Research & Technologies Ltd.

"It's been proved that it is extremely difficult to boost prices with monetary easing alone," he added.

The BOJ introduced the yield curve control not to strengthen the effects of its monetary easing but to reduce the negative effects, Monma observed.

Its negative interest rate policy made it even more difficult for financial institutions to make money on financial markets, Monma said, explaining that a key purpose of the yield curve control was to prevent long-term interest rates from falling excessively.

[Copyright The Jiji Press, Ltd.]

Jiji Press