In summary, maintaining the extremely accommodative financial environment is one of the necessary conditions for overcoming deflation. Another is confronting the fundamental cause of deflation – that is, the lack of demand – and making steady efforts to unlock and capture potential demand, as well as to improve productivity.
The Bank of Japan will maintain the extremely accommodative financial environment to underpin demand from the financial side. In my view, action should be taken swiftly and decisively when deemed necessary, based on an assessment of economic and financial activity and prices from the “two perspectives”.