Long and winding road to inflation in Japan

TOKYO - The Bank of Japan has stopped showing signs of additional easing for now, dampening market expectations.

The BOJ recently shifted its goal of achieving 2 per cent inflation, this time, by six months from the previous one. But yet, the bank decided to stand pat at its policy board meeting on Oct. 30.

Back in April 2013, when it introduced a massive monetary stimulus package, the BOJ pledged to reach the goal within about two years. Under the bank's latest scenario, however, it will take nearly four years to achieve the target -- double the time of the bank's original goal.

The BOJ said "the timing of reaching around 2 per cent" is projected to be "around the second half of fiscal 2016," which runs through March 2017. The bank presented this view in its Outlook for Economic Activity and Prices report, finalized at the late-October meeting.

At a post-meeting conference, Gov. Haruhiko Kuroda said, "The rise in prices alone is not necessarily good" without increases in wages and corporate earnings. When asked about the controversial words "two years," Kuroda said that at that time it was the earliest possible period for achieving the bank's goal.

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