The Bank of Japan should start paring its unprecedented easing soon or risk hurting people in its quest to stoke inflation, said Hideo Hayakawa, the central bank’s former chief economist.
Pushing inflation to the bank’s 2 percent target in a short period will raise living costs without boosting employment or economic growth, Hayakawa said in an interview yesterday. Prices are rising by about 1 percent and an intensifying labor shortage will eventually achieve the goal, he said.
“It’s important to quit while you’re ahead,” said Hayakawa, who was an executive director at the BOJ until March 2013. “Basically, drop the two-year reference, keep the 2 percent target and taper slowly.”
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