Tag Archives: Haruhiko Kuroda

BOJ’s Kuroda mentions the inflation rate after QE

According to Reuters (the source in Japanese), BOJ’s Kuroda said the inflation rate would remain fairly strong after the central bank achieves the inflation target of 2%. This statement is significant in the sense that he implied the moderate increasing of the inflation would be acceptable even after it becomes 2%.

As the increasing of the inflation usually follows the financial easing, considering the fact that the BOJ is willing to continue the QE until the inflation rate becomes 2%, the inflation rate is likely to increase after the QE up to around 2.5%. Consequently, the long-term interest rate, which is currently around 0.6%, couldn’t avoid to be hiked after the BOJ finishes the QE. The time to be short the bond futures is approaching.