BOJ to withdraw stimulus when program succeeds and 2 percent inflation target is in sight

  • Hard to say now at what pace withdrawal will be as that will depend on momentum at the time
  • Maintaining current stimulus policy would be sufficient to achieve 2% inflation goal
  • BOJ's recent pace of bond buying is largely in line with its pledge to increase its bond holdings at annual pace of 80 TRLN Yen
  • BOJ could raise rates first, reduce bond buying first,or do both at the same time to exit easy policy
  • If BOJ were to raise rates in future it will end negative rates and raise rates it pays on excess reserves financiail institutions park with BOJ

Harada outlining all the scenarios that may occur if/when the 2% target is reached