Bank of Japan Governor Haruhiko Kuroda said on Wednesday the chance the central bank will deepen negative interest rates is low for now, backing market expectations that no additional monetary easing is forthcoming in the near future.
Kuroda said Japan's economic growth was accelerating and keeping inflation on track to hit the BOJ's 2 percent target during the fiscal year ending in March 2019, in line with its latest quarterly forecasts made in November.
"The BOJ of course stands ready to ease further if needed to achieve its 2 percent inflation target," the central bank chief told parliament.
"With economic growth accelerating, however, the chance of deepening negative rates is low," he said, when asked about the pain the BOJ's policy is inflicting on regional banks' profits.
Kuroda also dismissed the view that the BOJ could raise its yield targets if Japanese long-term rates their global counterparts higher, driven by expectations of steady rate hikes by the U.S. Federal Reserve.
"There's still some distance to our 2 percent inflation target, so it's necessary to maintain powerful monetary easing to achieve the target at the earliest date possible," he said.
Reference: Reuters
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