|
In June of that year, Kuroda alluded to the fairy tale in
explaining that to fire up inflation, the BOJ needed to have the
public believe in its monetary magic with a huge blow of
stimulus.
Only with strong central bank commitment to achieve its 2%
inflation target could Japan eradicate the public's deflationary
mindset, he believed.
"I trust that many of you are familiar with the story of Peter
Pan, in which it says, 'the moment you doubt whether you can
fly, you cease forever to be able to do it'," Kuroda said back
then. "Yes, what we need is a positive attitude and conviction."
Soon after the comment, inflation began to slow on plunging oil
prices and the hit to consumption from a domestic sales tax
hike, forcing Kuroda's BOJ into retreat with a shift in 2016 to
the current controversial bond yield control policy.
At a briefing on Friday after his final policy meeting, Kuroda
said the Peter Pan line "wasn't my idea but something the BOJ's
staff came up with".
But he stressed the importance of communication in guiding
monetary policy, saying it was something he learnt during his
days studying economics at Oxford University.
"It's wrong and absurd to say something you don't believe in,"
Kuroda said. "I still believe it's necessary to do whatever it
takes to achieve 2% inflation."
Kuroda, whose second, five-year term ends in April, leaves the
BOJ with a mixed legacy: his massive stimulus is praised for
pulling the economy out of deflation, but it strained bank
profits and distorted market functions with prolonged low
interest rates.
Critics blame Kuroda for wrong-footing markets in 2016, by
abruptly introducing negative interest rates, and in December
last year when he stunned markets by allowing bond yields to
rise further.
"Personally, I did my best," Kuroda said when asked about
communication with markets. "But I also know I haven't been
perfect all the time."
(Reporting by Leika Kihara; Editing by Nick Macfie)
[© 2023 Thomson Reuters. All rights
reserved.]
This material may not be published,
broadcast, rewritten or redistributed.
Thompson Reuters is solely responsible for this content.
|
|
