BOJ's Kataoka: July's policy move could make BOJ's long-term yield target obsolete

Goushi Kataoka, Member of the Policy Board

• Chance low for Japan's economy to see momentum to hit price target heighten under current framework
• Didn't see need to allow long-term yields to move more flexibly when boj was cutting price forecasts
• July's policy move could make BOJ's long-term yield target obsolete
• BOJ new forward guidance only states obvious, see need for clearer guidance tied to inflation, inflation expectations and output gap
• Allowing long-term yields to rise when inflation still low could delay achievement of price target
• BOJ must take steps to guide super-long JGB yields lower
• Expect global economic expansion to weaken somewhat from next year and onwards

more to come