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Market Update: BOJ’s Kuroda: 2% inflation target is helping stabilise FX rates, no need to change it

The Bank of Japan (BOJ) Governor Haruhiko Kuroda is on the wires now, via Reuters, expressing his take on the inflation and monetary policy outlook. 

Key quotes

2% inflation target is helping stabilize FX rates.

There is no need to change the 2% inflation target, it’s a global standard and must not change.

Review of ETF purchases will enable BOJ to continue easing more flexibly and effectively.

More flexible ETF buyings to improve nimbleness.

Have not considered selling ETF holdings at all, or of halting purchases.

Decided to buy ETFs that are linked to the TOPIX to avoid impact on individual stocks.

Need to watch financial stability carefully.

Monetary easing will last for a considerably long time ahead.

ETF purchases are vital part of YCC.

Will guide YCC to avoid impact on stock prices.

Decided to adopt fixed-rate operations for consecutive days to avoid a spike in interest rates.

USD/JPY trades flat amid risk-aversion

USD/JPY fails to have any impact from Kuroda’s comments, as it currently trades flat at 108.86, divided between broad-based US dollar strength and falling Treasury yields.

The market mood remains sour amid fears over inflation and economic overheating.