BOJ’s Nakaso: Must remove deflationary mindset once and for all

Comments crossing the wires from BOJ’s Deputy Governor Nakaso, in a statement published this Monday.

Key Quotes:

Easing and structural reforms are both essential

Easing/structural reforms, complementary to each other

Sustained inflation seen for 1st time since late 90s

Must remove deflationary mindset once and for all

Must better explain the year for negative rates to the public

Government growth strategy started to show tangible results

Private sector needs to do more to boost competitiveness

Need to redouble efforts to raise growth rate

It will take a while before effects of governments grow strategy become visible

Will economy improved due to accommodative situation

Explaining more persuasively that monetary policy steps are needed to achieve sustainable economic growth seems to be a challenge that BOJ and ECB have

Must clearly explain effects of monetary policy should be assessed in terms of macroeconomic effects such as benefits from a rise in employment/wages

Negative rates have not undermined financial intermediation