BoJ to stick with phasing out monetary stimulus

Ueda: The objective of the bank’s monetary policy is achieving price stability, which is its mission as stipulated by law. — Reuters

TOKYO: Bank of Japan governor Kazuo Ueda says considerations over the central bank’s finances would not prevent it from phasing out its massive monetary stimulus when the appropriate time comes.

While Ueda said there was “still a distance to go” before the BoJ exits ultra-loose monetary policy, his remarks come at a time when markets are rife with speculation he will dismantle his predecessor Haruhiko Kuroda’s radical stimulus programme.Speaking at an academic seminar last Saturday, Ueda said the BoJ’s profits will be squeezed when it raises interest rates because doing so would increase interest rate payments it makes to financial institutions’ reserves parked at the central bank.