BOJ should give itself more time to achieve price target: board member

“Inflation may reach 2% at some point in the future if, as hoped for, structural reforms progress and boost Japan’s growth potential,”

Mr Kiuchi is 100% right. The exact timing depends on the government, not the BOJ, which is doing more than enough base money supply expansion.

It eased policy again in October last year, but inflation has grounded to a halt on slumping oil prices and weak household spending.

Isn't it ridiculous that they factor in oil prices. The US shale revolution has produced a positive supply side shock. There's nothing about that that the BOJ can control or should try to control. No one, outside of the energy production sector, is complaining that their energy costs are going down, so far as I know. So who cares about oil prices going down. Energy prices won't go down forever, it's just a phase.

the BOJ’s massive purchases have dried up liquidity in the bond market and may destabilize price moves in the future.

Man's got his head screwed on the right way.

Price moves might be especially unstable if the government continues to drag it's feet on it's fiscal problems. I can't imagine bond prices being especially stable should the government be issuing trillions of yen of fresh debt each year as it does now, at the same time as the BOJ is trying to reduce it's own bond holdings, together with the GPIF etc having moved away from buying risky government debt. Besides speculators who'd want to buy?

BOJ 2% target policy is folly given the demographic structure of Japan. This policy has resulted in huge transfer of wealth from Savers & Importers to Government & Exporters. Another of BOJ bad side effect is also getting the government to be complacent. What Japan needs is True Reform and the Reform is MUCH SMALLER GOVERNMENT to cut down the gigantic expenditures of government. The government is getting bigger and not smaller though, since Abenomics.

Kiuchi repeated his calls for watering down the two-year time frame for meeting the inflation target, warning that Japan will see prices rise only gradually given the economy’s low growth potential.

“Inflation may reach 2% at some point in the future if, as hoped for, structural reforms progress and boost Japan’s growth potential,” the former market economist told business leaders in Maebashi, Gunma Prefecture.

“But it’s important to guide policy based on the understanding that an appropriate level of inflation for Japan now is lower (than 2%),” he said.

Exactly what myself and many other posters have been saying for months. Chasing inflation for inflation sake is simply foolish. It has to be based on "Japan's growth potential" as Kuchi says, not simply dumping more and more money into a stagnant economy.