Bank of Japan Governor Haruhiko Kuroda said on Monday that economic growth is gathering momentum and increasing the chances of inflation hitting his 2 percent target, reinforcing market expectations that no additional stimulus is forthcoming.Kuroda said the central bank was closely watching the economic effects of prolonged ultra-easy policy, particularly the damage it could inflict on financial institutions’ margins.“The current economic expansion doesn’t rely on specific factors and is supported by various elements. We therefore see the expansion as highly sustainable,” Kuroda said in a speech to business leaders in Nagoya, central Japan.“The BOJ is mindful of the risk that its low-interest rate policy, if prolonged, could weigh on financial institutions’ profits,” he added, noting that reduced profits could discourage financial institutions from boosting lending.
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