Bank of Japan Governor Ueda:
- As we taper bond buying, we will of course be aiming to shrink size of our balance sheet in ratio to GDP terms
- Basic purpose of our bond tapering would be to allow yields to move more freely driven by market forces, and revive market functioning
- Japan's economy will likely see more clear signs of positive wage-inflation cycle as nominal wages rise
- Must be vigilant to impact of weak yen, import price moves on economy
Corporate price, wage-setting behaviour clearly changing on record profits, tightening job market
Nominal wages likely to rise ahead and gradually lead to positive real household income, underpin consumption
Consumption likely to increase moderately as nominal wage gains accelerate
For now, don't expect japan to experience stagflation
Earlier from Ueda:
- Bank of Japan Gov Ueda expects strengthening in Japan wage-price cycle - higher inflation
- Bank of Japan Governor Ueda says chance we could raise interest rates at July meeting
Meanwhile, USD/JPY is still moving in a small range only:
