Junko Nakagawa, one of the nine members who decide on the Bank of Japan's monetary policy, gave a speech in Matsue on the 7th, stating that the Japanese economy is moving towards achieving the 2% price stability target, which is the premise of the Bank of Japan's policy change. It was recognized that we are making steady progress.
Regarding the domestic economic and price situation, Commissioner Nakagawa said, ``I think we can see a virtuous cycle in wages and prices.There are clear signs of change in companies' attitudes toward wage setting, and the 2% inflation rate has increased.'' We are making steady progress toward achieving our stability goals."
Regarding future monetary policy, he said, ``There are risks and uncertainties, so I would like to continue gathering information and make decisions without making too many assumptions.'' If he were to revise his monetary policy, he would consider negative interest rates and ``yield curve control.'' In addition to the proposed framework, the Bank also indicated its intention to determine whether there is a need to revise policy measures such as the purchase of risky assets.
Commissioner Nakagawa held a press conference after the meeting, commenting that there was a view in the market that the Bank of Japan might decide to lift negative interest rates at its monetary policy meeting starting on the 18th of this month, saying, ``Service prices are rising, albeit slowly.'' Based on the current trends, it appears that there is a movement from wage increases to sales prices.We will carefully analyze the data and information that will be released, including trends in labor-management negotiations, and believe that the virtuous cycle between wage increases and prices will become stronger. I would like to confirm this before making a decision."