Although consumer price inflation eased to around zero mainly reflecting the significant decline in crude prices, the underlying trend of inflation has improved markedly, Bank of Japan Governor Haruhiko Kuroda said at a luncheon speech at the Economic Club of Minnesota on Sunday.
The monetary easing implemented by the BoJ is having the intended effects and the economy is making steady progress on its way to conquering deflation.
He noted that a number of indications of the deflationary mindset that had taken hold in Japan as subsiding.
Quantitative and qualitative monetary easing is starting to achieve what some may have thought impossible, Kuroda added.
He concluded, “If Japan can successfully overcome deflation and re-anchor inflation expectations, as it is now in the process of doing, this will represent a major step in monetary policy history not only in Japan but also around the globe.”
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