Japan's new central bank governor Kazuo Ueda says he is in no rush to shift away from the radical monetary stimulus of his predecessor, but wage pressures may force him to make the policy tweaks faster than he'd like
, is widely expected by markets to take Japan out of the extremely accommodative monetary settings introduced by previous governor Haruhiko Kuroda in recent years - the only question is when he might do this.
Analysts say that could rekindle market expectations of a change to yield curve control , a policy that caps the 10-year bond yield around zero and has drawn criticism for distorting markets and hurting banks' margins. Having battled Japan's debilitating deflation as BOJ board member two decades ago, Ueda stressed the need to wait until budding signs of wage growth become sustained, and help inflation stably meet the central bank's 2% target.pledged by major firms this year and a rebound in private consumption heighten the chance inflation will remain elevated, analysts say, casting doubt over the BOJ's view that sustained achievement of 2% inflation remains elusive.
Under the assumption that solid economic growth will prod firms to raise wages and inflation, the BOJ currently expects core-core inflation to hit 1.8% in the fiscal year that began in April before slowing to 1.6% the following year.
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