DAVOS, Switzerland (Reuters) - There are a number of factors preventing the Bank of Japan from reaching its 2 percent inflation target but wages and prices are gradually rising and it is getting closer, the governor of the central bank Haruhiko Kuroda said on Friday.
Speaking at the World Economic Forum in Davos, Kuroda spoke of a “tenacious” deflationary mindset in Japan that was proving difficult to overcome, and also cited globalization as a factor in keeping inflation low.
“Therefore the Bank of Japan will continue to support Japan’s economy and prices by pursuing powerful monetary easing,” Kuroda told the audience.
Still, he pointed to signs that wages and prices were rising, and that inflation expectations were also picking up slightly.
“So there are many factors which made achieving the 2 percent inflation target or price stability target so difficult and time consuming. But I think we are finally close to the target,” he said.
Writing by Noah Barkin, editing Mark Bendeich