Speaking in Japan's parliament, the Bank of Japan's (BoJ) governor Haruhiko Kuroda stated on Friday that in his view it is premature to raise yields target or to take steps to steepen the yield curve at the moment. The current yield curve control (YCC) policy is appropriate, he added.
Also, Kuroda said that BoJ's board will likely debate various options, when inflation achieves a 2% target, adding that targeting shorter maturity JGB yield could become an option.
Commenting on the Fed's recently announced plans on policy path, the BoJ's governor said it is very appropriate for the U.S. central bank to shift policy given increased inflation expectations. He also added that it is desirable for Japan’s economy that the U.S. economy continues to achieve strong expansion without excessive inflation. At the same time, he noted that the Fed's monetary tightening has triggered a weakening of the yen, but added that is not always the case. Overall, he said, he does not expect the Fed's hawkish policy to have a negative impact on Japan’s economy.