Bank of Japan Governor Haruhiko Kuroda on Tuesday stressed the bank’s readiness to expand stimulus further to meet its price goal, a message that was partially echoed by an European Central Bank policymaker as the euro zone economy battles to lift off.
In a speech to business leaders, Kuroda stood firm in the face of criticism that last month’s unexpected monetary easing has accelerated unwelcome falls in the currency, saying that the “BOJ will continue to take action” to vanquish deflation.
But not all in the BOJ’s nine-member board share Kuroda’s optimism that the benefits of further stimulus outweigh the costs, minutes of last month’s meeting showed, suggesting that the central bank chief may struggle to push through more easing.
Some BOJ policymakers opposed last month’s easing, warning that doing so would hurt the BOJ’s credibility if its bond-buying is seen as tantamount to debt monetization, according to minutes of the BOJ’s Oct. 31 meeting released on Tuesday
Nonetheless, Kuroda defended the Oct. 31 easing as a necessary step to ensure the Japanese public shakes off its “deflationary mindset,” and to encourage companies to start investing and hiring more on expectations that prices will rise ahead.
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