Bank of Japan Gov. Kazuo Ueda said Monday that the central bank's inflation forecasts must be "quite strong and close to 2%" in the coming year to consider tweaking the so-called yield curve control (YCC).
"At present, trend inflation is below 2%, so we must maintain monetary easing," Ueda told parliament. "But when trend inflation is projected to reach 2%, the BOJ must normalize monetary policy."
Ueda's comments come ahead of a two-day BOJ policy meeting that kicks off on Thursday, where the board will produce fresh quarterly growth and inflation forecasts.