BoJ Governor Haruhiko Kuroda told the parliament, “it’s premature to lay out details of an exit strategy. But one major factor of debate will be the pace of increase in the BoJ’s short-term policy rate, now set at -0.1%.”
“Another factor would be how to adjust its balance sheet,” he said, noting that other major central banks adopted the sequence of interest rate hike first, then shrinking balance sheet.
“It’s extremely important for the BOJ to underpin the economy with ultra-loose monetary policy and ensure the necessary environment is falling into place for companies to hike wages,” Kuroda emphasized.
ECB bulletin: Further weakening of economy into beginning of 2023
In the monthly economic bulletin, ECB said the Governing Council expects a “further weakening” of economic activity “in the remainder of 2022 and the beginning of 2023”.
High inflation continues to “dampen spending and production” and severe disruptions in gas supply “have worsened the situation further”.
Additionally, “worsening terms of trade”, with imports prices rising faster than exports prices, are “weighing on incomes in the euro area”.
Risks to the economic growth outlook are “clearly on the downside, especially in the near term”. Risks to the inflation outlook are “primarily on the upside”.
ECB’s future policy rate decisions will continue to be “data dependent” and follow a “meeting-by-meeting approach”.
Full monthly bulletin here.