:Bank of Japan (BOJ) Governor Kazuo Ueda said on Tuesday there was still some distance to sustainably and stably achieving the central bank's 2 per cent inflation target, signalling his resolve to maintain ultra-loose monetary policy for the time being.
"We have patiently continued our ultra-loose monetary policy under yield curve control (YCC)," with due consideration to the impact on financial intermediation and market function, Ueda told a news conference after attending a G20 finance leaders' meeting in India.
Ueda said the BOJ will scrutinise at each policy meeting the pace of progress Japan was making in sustainably achieving its 2 per cent target.
"If our assumption (that sustained achievement of 2 per cent inflation remains distant) is unchanged, our overall narrative on monetary policy remains unchanged," he said.
His remarks came in response to a question on whether the central bank saw a need to tweak YCC at its rate review later this month.
Under YCC, the BOJ guides short-term interest rates at -0.1 per cent and buys huge amounts of government bonds to cap the 10-year bond yield around 0 per cent as part of efforts to fire up inflation to its 2 per cent target.
With inflation having exceeded its 2 per cent target for more than a year, markets are rife with speculation the BOJ could tweak YCC as early as this month to address the mounting costs, such as market distortions, caused by its huge bond buying to defend the yield cap.
Sources have told Reuters the BOJ has been internally discussing the idea of tweaking YCC as early as this month, though the talks are preliminary and no final decision has been made.