ZURICH (Reuters) - Bank of Japan Governor Haruhiko Kuroda expects to achieve the central bank’s long term inflation target of 2 percent by fiscal year 2019, he told an event in Zurich on Monday.
The BOJ was making good progress tackling low inflation until oil prices slumped from 110 dollars per barrel to less than 30 dollar per barrel in 2014, dragging down prices in Japan, which imports all of its oil.
“The inflation situation has slightly improved, and now unless another price shock or something happens, we expect inflation rate to reach around 2 percent in fiscal 2019,” he told an event at Zurich University.
The Japanese government which has built up a debt to GDP ratio of more than 200 percent also needed to reduce its debts over the next decade, he said.
The current level is “simply unsustainable”, Kuroda said.
Reporting by John Revill; Editing by Balazs Koranyi