haruhiko kuroda : recent developments in japan ’ s economy, and observations on the european situation given japan ’ s experience during the 1990s financial crisis remarks by mr haruhiko kuroda, governor of the bank of japan, at the paris europlace financial forum, tokyo, 25 november 2013. * * * introduction i am honored to have this opportunity to speak before the paris europlace financial forum today. in the following few minutes, after briefly touching on the recent developments in japan ’ s economy, i would like to go over what we can say about the european authorities ’ various initiatives from our experience of japan ’ s financial crisis in the 1990s, bearing in mind the recent european situation. the developments in japan ’ s economy and prices i would like to start off with the recent developments in japan ’ s economic activity and prices. the bank of japan introduced quantitative and qualitative monetary easing ( qqe ) in april this year with a view to bringing japan ’ s economy out of deflation, which has lasted for nearly 15 years. in the subsequent eight months, the bank has been steadily pursuing this policy. positive developments have been spreading in financial markets and the real economy, as well as in people ’ s mindset and expectations. the qqe has steadily been exerting its intended effects. japan ’ s economy is recovering moderately, with a positive spillover from income to expenditure in the household and corporate sectors taking course. looking ahead, a virtuous circle among production, income, and spending is expected to continue, and japan ’ s economy is projected to grow, as a trend, at a pace above its potential. on the price front, the year - on - year rate of increase in the consumer price index ( cpi ) for all items less fresh food has recently been accelerating to a range between 0. 5 and 1. 0 percent. with the prospect of an improvement in the aggregate supply and demand balance and a rise in medium - to long - term inflation expectations, the year - on - year rate of change in the cpi is likely to follow a rising trend. therefore, japan ’ s economy has been following a path toward achieving the 2 percent price stability target as expected. european situation now, let me briefly refer to the european situation. while details will be provided by governor noyer, our recognition is that the european economy is bottoming out and there are signs of a pick - up. as a recovery in the european economy is

are appropriate in the area of corporate lending. bis central bankers ’ speeches concluding remarks regarding what i have talked about today, we do not have clear answers yet on such issues as the detection of financial imbalances or measures to revitalize corporate financing. these deserve further examination. it would be beneficial if, by using occasions like this event, we could accumulate our knowledge on those issues by also learning from the experiences of our european colleagues. by making use of views exchanged with you, the bank, through bringing japan ’ s economy out of deflation that has lasted for nearly 15 years while maintaining the stability of the financial system, will contribute to sustainable growth of the global economy. i would like to thank you very much for your kind attention. bis central bankers ’ speeches