Bank of Japan Gov. Haruhiko Kuroda appears more determined than ever to weather political and market pressure in pursuit of sustainable inflation.
With just months remaining of his decade-long mission to push up price gains to a consistent rate of 2%, Kuroda is in no mood to give up on stimulus and jeopardize his legacy now, according to people familiar with the matter. BOJ officials see some potential green shoots of sustainable inflation that need encouragement, not elimination, the people said.
That leaves the BOJ alone among major central banks in trying to hold rates near zero and cap bond yields, stimulus Kuroda sees as needed for an economy that’s smaller than it was before the pandemic. The BOJ spent a record $115 billion (¥15.9 trillion) defending yields last month as traders bet it may have to scrap the policy given the yen’s slide to a 24-year low, which is driving up the cost of fuel and staples like soy sauce and sushi.