BoJ board member Naoki Tamura said that Japan’s moderate economy recovery path is expected to continue, positive cycle of wage increases leading to higher inflation rates.
“The risk of our medium- and long-term forecasts being derailed is likely small,” he remarked in a speech today.
He underscored the importance of a deliberate and gradual approach to policy normalization, ensuring that the transition away from aggressive monetary support is managed with precision and foresight.
“How to manage monetary policy ahead is very important to ensure we deftly roll back our massive stimulus program, and move slowly but steadily toward policy normalization,” he articulated.
Central to Tamura’s vision is the restoration of interest rate flexibility, positioning BoJ to effectively modulate demand and influence price dynamics through rate adjustments.
“In my view, the central bank’s ultimate goal is to bring interest rates back to levels where they can be pushed up or down to adjust demand, and influence price moves,” he stated.
