Ex-Fed Bernanke: There is still a strong case for BOJ to continue with 2% inflation target

Former Federal Reserve (Fed) Chairman Ben Bernanke crossed the wires earlier today, via Reuters, commenting on the BOJ’s monetary policy program and its impact on the Japanese economy.

Key Headlines:

Want to reaffirm importance of BOJ's pursuit of 2 pct inflation target

Important aspect of BOJ's inflation target is it will lead to future economic stability

If Japan’s inflation rises to 2 pct in 2018, this would reduce debt/GDP ratio by around 21 pct

Despite improvement in Japan's economy, there is still a strong case for BOJ to continue with 2 pct inflation target

I see BOJ's inflation overshoot commitment and YCC as constructive developments

BOJ will likely to be able to control JGB yields with smaller volumes of purchases

Transmission mechanisms for BOJ have approached their limit