Citing sources familiar with the Bank of Japan (BOJ) thinking, Reuters reports the Japanese central bank may be compelled to dial back its commitment to achieving the 2% price target amid coronavirus-induced rising economic costs and dwindling domestic consumption.
Key Quotes:
“After years of trying to vanquish deflation by setting an ambitious price goal, Japan’s waning recovery prospects and a dwindling policy tool-kit have made the BOJ more open to conceding that the best it can do is to keep the economy afloat.
While the inflation target remains very important, the focus of the BOJ’s policy has shifted toward keeping the economy on a sustainable recovery path.”
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