BoJ speculates on further QQE to offset Fed taper effects

FXStreet (Bali) - Bank of Japan Governor Kuroda was interviewed by the Australian Financial Review following the G20 finance ministers meeting, saying Japan's commitment to QQ3 (quantitative and qualitative easing) should stay its course until the 2% inflation target is met.

Key Quotes - AFR

“Our commitment – you can call it forward guidance – is to continue the QQE (quantitative and qualitative easing) until the 2 per cent inflation target is met: 2 per cent inflation sustained in a stable way."

“We cannot pinpoint 2 per cent every month because inflation fluctuates, but we must reach a 2 per cent stable rate. Until that time we will continue the QQE,” he said in a rejection of some financial market scepticism that the target will be met after recent weak quarterly growth figures."

“All central banks must be cognisant of the need to co-operate to exchange views and make quite clear their monetary policy stance. “Particularly they have to be cog­nisant of the potential impact on the global economy.”

“The fact is there will be sequencing of the normalisation process. I agree that Japan and Europe have continued to have very accommodative monetary policy and it could mitigate the impact of the Fed’s action on capital flow in that sense. It is complicated, but prima facie you can say this.”