March 2, 2018 / 5:07 AM / a year ago

BOJ Kuroda rules out early hike in yield target

TOKYO (Reuters) - Bank of Japan Governor Haruhiko Kuroda on Friday dismissed the chance of raising the bank’s long-term interest rate target just because inflation reaches 1 percent.

Some have called on the BOJ to raise its bond yield target before inflation hits the bank’s 2 percent target, arguing that 2 percent was too high a level to aim for in a country that has suffered from two decades of deflation.

“As European and U.S. central banks normalize monetary policy and Japan’s inflation picks up, markets may put upward pressure on long-term interest rates,” Kuroda told parliament.

“I’m hesitant and cautious at this stage of immediately yielding to such market pressure and raising our long-term yield target,” he said.

Reporting by Leika Kihara and Tetsushi Kajimoto; Editing by Chang-Ran Kim

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