TOKYO, July 20 (Xinhua) -- The Bank of Japan on Thursday delayed the time frame for achieving its 2 percent inflation target by a year to fiscal 2019, in a bid to hit its goal against a backdrop of sluggish price gains that have remained resilient to the bank's massive monetary easing initiatives.
The bank delayed its inflation goal target date to give itself more of a run-up to hit its lofty goal amid strained prices, and the bank has indicated its stimulus programs will be kept at the same level and its monetary policy to remain ultra-accommodative into the foreseeable future.
The move runs contrary to those of other central banks, such as the European Central Bank and the U.S. Federal Reserve, who have both signaled they are nearing the point at which they will exit from their respective stimulus programs.
The central bank maintained its monetary policy, which comprises asset purchases and its negative interest rate on funds held in financial institutes, in a bid to ensure more liquidity and investment in the market, with the end goal being increased spending from households and higher wages eventually converting into increased prices.
Following the two-day policy board meeting, a quarterly report was released which showed the central bank cut its inflation forecast for the year to March 2017 from 1.4 percent to 1.1 percent and lowered its forecast for the year to March 2019, from 1.7 percent to 1.5 percent.
The bank also said it expects prices to rise 1.5 percent in fiscal 2018, drooping from an earlier projection of 1.7 percent.
The forecast for Japan's economic expansion was upgraded by the bank, however, as key economic data has come in on or above par in general of late. As such, the bank now expects gross domestic product (GDP) in fiscal 2017 to increase 1.8 percent compared to 1.6 percent forecast in April, with the outlook for fiscal 2018 also expected to expand from 1.3 percent to 1.4 percent.
