BOJ’s Ueda says volatile markets, global uncertainty prompts vigilance By Reuters

By Leica Kihara

(Reuters) – Bank of Japan Governor Kazuo Ueda said on Wednesday the central bank must be alert to the effects of volatile markets and global economic uncertainties for now, underscoring its focus on supporting a fragile economic recovery.

Ueda reiterated the BOJ’s view that Japan’s economy will sustain a moderate recovery and help core inflation converge toward the central bank’s 2 percent target in the coming years.

But it stopped short of repeating the central bank’s recent pledge to keep raising interest rates if inflation moves in line with its forecast, instead emphasizing its focus on various risks.

“Uncertainty about Japan’s economy and prices remains high,” Ueda said in a speech at an annual securities industry meeting.

“The outlook for overseas economies, including the US, remains uncertain, while financial markets are still volatile,” he said. “For now, we will look at such developments with extreme vigilance.”

Ueda’s remarks came after Prime Minister Shigeru Ishiba on Tuesday called on the BOJ to maintain loose monetary policy as the government focused on lifting Japan’s economy out of stagnation.