The Bank of Japan’s unsuccessful fight against deflation

The monetary policy objective of the Bank of Japan (BoJ) is to maintain price stability, with the target of 2 percent of the yearly growth in the consumer price index.

For years, Japan has faced on and off deflation and a stagnating economy. Exiting from the “deflationary mind-set” – together with a revival of growth – stays at the center of both Prime Minister Abe’s three-arrow recovery plan and the BoJ’s monetary policy agenda.

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