It was determined at today’s meeting that we cannot say that core consumer prices have stabilized above zero. The bank has not decided when to shift its policy.

However, in spite of the general perception that monetary policy should be conducted so as to avert deflation, a central bank cannot lower interest rates below the zero lower bound.

Our judgment now shows the economy has almost broadly emerged from a stalled stage,

The staff at the Institute will present an analysis on how asset price fluctuations and subsequent structural adjustments influence sustained economic growth, based on Japan’s experience since the second half of the 1980s.

However close attention will have to be paid to rising crude oil prices and their impact on the domestic and overseas economies.

Our intention is not to move to credit tightening now.

There is no reason to think now that interest rates will be left at zero for a just a short while after quantitative easing has ended and no reason that they will be zero for...

I certainly welcome discussions on how central banks can best contribute to sustained economic growth and sound development of the global economy.

We will confirm that consumer prices will stabilize at zero or above before taking action.

The standard growth theory tells us that economic growth in per capita basis comes from mainly two sources: capital deepening and total factor productivity growth, or TFP growth.

having almost escaped its soft patch.

If we judge that inflationary pressures are restrained and the economy can achieve balanced growth, we can keep interest rates at very low levels.

Japan’s economic situation is at an important stage. Price judgment is needed about the future course, but I have no determined idea,

In fact, the recent increase in intra-firm trading enables businesses to shift their activities across borders smoothly, thereby strengthening the response of economic activity to exchange rate movements in the long run.

Investors are aware that the economy’s fundamentals are firm. We hope they react calmly.

They emphasize the viewpoint that the protracted economic stagnation in Japan derives from incomplete economic adjustments to significant changes in relative prices.

Interest rates will stay at zero for some time, then stay extremely low and go through an adjustment period.

We will still have leeway then.

Rises in prices may not accelerate, but it’s unlikely that they will fall back into negative territory once they start rising,

In this context, the current recovery in the Japanese economy is taking place in tandem with the growing interdependence with the rest of the world, particularly with the other East Asian economies.

I think market participants’ common view is that economic fundamentals in Japan are firm. I hope they will react calmly.

Thus, the questions we should ask here are what makes the current economic upswing different from the past two recoveries, and whether such differences are sufficient for the economy to reach the sustained growth path.

Interest rates will stay at zero for a while, then move to extremely low levels before being adjusted according to economic conditions.

All we can say is that we will respond appropriately to economic and financial conditions.

The year-on-year rate of change in consumer prices is projected to be zero percent or to show a slight increase towards the end of this year,

Japan’s experience suggests the importance of assessing the sustainability of price stability over a fairly long period, which many central banks have emphasized in recent years.

Second-quarter GDP was revised upwards, representing the well-balanced nature of the recovery in Japan’s economy,

We cannot say for sure that the current recovery will be durable and strong enough to push the economy back to a sustained growth path.

We are entering an important phase as the situation surrounding the economy and prices is heading toward a favorable direction.

Japan’s economy is likely to experience a sustained period of expansion, with domestic and external demand and also the corporate and household sectors well in balance.

People think the withdrawal of monetary accommodation is about to get under way. People can price it in before any possible change (in monetary policy) on a global basis,

On the contrary, exchange rate movements still play an important role in facilitating more efficient resource allocations in the long run.

Based on a recovering overall economic climate, the consumer price index, excluding fresh food prices, was at or above zero percent for the third consecutive month since October.

Well-functioning financial systems are important in achieving sustained economic growth. They play a crucial role in channeling household savings into the corporate sector and allocating investment funds among firms.

We firmly cannot agree to adhere to calls to continue with an abnormal policy forever,

A low rate of inflation itself now poses a new challenge of achieving and promoting sustained economic growth in the global economy.

The Japanese economy has finally crawled out of a lull which began in the summer of last year and is continuing to recover,

Recent empirical studies, however, show such short run effects become small because the exchange rate pass-through to import prices declines.

Our top priority is to help bring about sustained economic growth, and moving out of deflation is only half way there.

With weak balance sheets, banks tend to continue lending unprofitable businesses and leave them existing.

Market participants share the view that fundamentals are strong.

As for the short run effects, exchange rate movements influence the economy through changing relative prices between goods at home and abroad.

There is a high chance that core consumer prices will turn to be positive toward the end of the year.

The aging and decreasing population is a serious problem in many developed countries today. In Japan’s case, these demographic changes are taking place at a more rapid pace than any other country has ever experienced.

It’s necessary to make the judgment calmly and objectively without any preconceived notions about whether the consumer price index excluding fresh food prices has stabilized at zero or above.

[The time by which core prices will achieve stable gains] is getting pretty close, … That means interest rates will eventually head toward positive territory.

As the new endogenous growth theory suggests, TFP growth is closely related to accumulation of the intangible capitals, such as human capital and research and development.

is becoming quite short.

The direct investment of Japanese businesses to East Asian economies accelerates the reallocation of their production bases. Consequently, between Japan and the other East Asian countries, both exports and imports are growing substantially.

If we delayed the move, we would have turned certainty into uncertainty.