s policy stance of continuing with the current powerful monetary easing. on the other hand, in order to strengthen the sustainability and durability of this powerful monetary easing, the side effects of the policy also warrant attention. in the first half of this year, it was pointed out that the functioning of the japanese government bond ( jgb ) market had deteriorated under the bank's large - scale jgb purchases, as seen, for example, in somewhat rigid interest rate formation. therefore, at the july mpm, the bank also decided to conduct market operations and asset purchases in a more flexible manner. as a result, the degree of market functioning has improved, with jgb yields moving upward and downward again in tandem with stock prices and u. s. interest rates. in addition, the bank is aware that prolonged downward pressure on financial institutions'profits, with the low interest rate environment and severe competition among financial institutions continuing, could create risks of a gradual pullback in financial intermediation and of destabilizing the financial system. although these risks are judged as not significant at this point, mainly because financial institutions have sufficient capital bases, it is necessary to pay close attention to future developments, including from the perspective of maintaining policy sustainability and durability. as explained, the bank will proceed step by step toward achieving the price stability target under the powerful monetary easing while taking into account in a balanced manner not only the benefits of monetary easing but also its costs. it is likely to take more time than expected to achieve the price stability target, and uncertainties regarding the outlook have heightened further. however, firmly maintaining the momentum toward achieving 2 percent inflation through such policy conduct will ultimately help to ensure the price stability target is achieved at the earliest possible time without putting an excessive burden on the real economy and the functioning of financial intermediation. conclusion it seems that we are almost out of time. today, i looked back on the economic recovery over the past six years and talked in some detail about firms'efforts toward improving productivity so far and future prospects. i also touched upon the possibility that responding to the recent labor shortage and actively proceeding with measures such as labor - saving investment will ultimately help firms to secure talented human capital and create and exploit new demand. the bank will provide its utmost support for such efforts by firms through maintaining highly accommodative financial conditions. 2019 is the year of the boar in the japanese zodiac. while boars tend to have a reputation of heading to a target

##ented to start with and lack venture spirits. however, in the past, there were times when the establishment rate in japan was comparable to that in countries around the world. stability - oriented dna is a mere perception. we expect firms to aggressively exert entrepreneurship. at the same time, it is also important for the public sector to prepare an environment in which challenges to new businesses can easily take place. concluding remarks the economy in this region has been picking up, while there is lingering severity in private demand, including business fixed investment and private consumption. against such a backdrop, miyagi prefecture has set a goal of “ achieving the wealth prefecture miyagi, and striving to achieve gross production of 10 trillion yen, ” and has been making efforts to vitalize the industries from various perspectives. i have learned that many companies were already attracted to the region. moreover, sendai city has a broad - based ability to pull in customers as the largest commercial city in the tohoku region, and largescale facilities have recently been opened one after another. of course, the environment surrounding the regional economy, including intensified competition with overseas and the decline in public works, is by no means favorable. however, the region is full of attractions, with one of the nation ’ s largest granaries, a wealth of fishery resources, many research institutions, and ample traditional craft industries. the region has high potential for growth. today, i am scheduled to visit various places such as the central shopping area in front of sendai station. i believe it is a valuable opportunity to gain firsthand knowledge about the reality of the regional economy that cannot be gauged through statistics and the media. moreover, as called as “ a city of trees, ” boulevard trees here are beautiful, and i can just imagine that it might be dazzlingly beautiful when green shoots burst out all together through early summer. like those green shoots, i am also looking forward to closely seeing your efforts toward growth.