BoJ’s Nakagawa: Still not at stage where Japan has stably, sustainably achieved price target

Early Thursday morning in Asia, Bank of Japan (BoJ) policymaker Junko Nakagawa crossed wires via Reuters while defending the Japanese central bank's current monetary policy.

BOJ’s Nakagawa initially defended the easy monetary policy by stating that it is appropriate to maintain easy monetary policy for time being while adding that they’re still not at stage where we can say Japan has stably, sustainably achieved BoJ price target.

The policymaker highlighted the various side-effects of the monetary easing while also saying that the BoJ will conduct flexible market operation when 10-year Japanese Government Bond (JGB) yield moves in range of 0.5-1.0% range with eye on interest rate levels and speed of moves.

“BoJ's July decision has heightened sustainability of its monetary easing framework,” added BoJ’s Nakagawa while highlighting expectations of witnessing moderate economic recovery at home and fears of further slowdown in the global growth.

The policymaker showed indecision about inflation conditions while saying that there is chance inflation could accelerate more than expected, though there is also chance pass-through of costs could moderate.

USD/JPY retreats

Following the comments from BoJ policymaker Nakagawa, the USD/JPY pair retreats from the yearly high of 147.87 to 147.57 by the press time.

Also read: USD/JPY prints fresh YTD peak around 147.85, intervention fears might cap gains