the bank is pursuing monetary easing under the framework of yield curve control, in which the short - term policy interest rate is set at minus 0. 1 percent, the target level of 10 - year japanese government bond ( jgb ) yields is around zero percent, and the range of 10 - year jgb yield fluctuations is around plus and minus 0. 5 percentage points from the target level ( chart 10 ). i will focus on three points regarding this monetary policy. first, the short - term policy interest rate is decided and controlled solely by the bank. if, in the future, the bank were to terminate its negative interest rate policy and apply, for example, a zero interest rate, it would raise the short - term policy interest rate by 0. 1 percentage point. this decision will be made if the bank assesses that it would be appropriate to prevent price rises by suppressing demand in the real economy. applying this to the risk - management approach, by maintaining a negative interest rate of minus 0. 1 percent, the upside risk of the inflation rate continuing to exceed 2 percent if monetary tightening falls behind the curve becomes a greater concern than the downside risk. given current developments in economic activity and prices in japan, the bank assesses that there is still a long way to go before such decisions are made. second, in its policy statement, the bank has made a commitment to continue with the current framework of qqe with yield curve control, aiming to achieve the price stability target of 2 percent, as long as it is necessary for maintaining that target in a stable manner. at this point in time, sustainable and stable achievement of the 2 percent target has not yet come in sight. therefore, the bank will maintain the current framework in accordance with its commitment. third, in conducting yield curve control under the current policy framework, the bank has been striking a balance between its positive effects and side effects from the viewpoint of keeping in mind the impact on the functioning of financial intermediation and the market while continuing with monetary easing in a sustained manner. every policy has its positive effects, but it also always comes with costs. there is no free lunch for any policy. given that the bank is conducting monetary easing at such a large scale, this has had positive effects, but at the same time, profits of financial institutions and the functioning of financial intermediation have been affected ( chart 11 ). in addition, controlling interest rates inevitably has had an impact on market functioning. the balance between

of countless stakeholders and financial institutions. i would like to express my respect for your efforts to ensure the region's economic and financial resilience. this year marks the 150th anniversary of the birth of chiba prefecture. let me conclude by offering my congratulations and hope that its economy will continue to flourish. thank you very much for your attention. japan's economy and monetary policy speech at a meeting with local leaders in chiba august 2, 2023 uchida shinichi deputy governor of the bank of japan introduction i. current situation of and outlook for economic activity ii. current situation of and outlook for prices iii. the bank's conduct of monetary policy iv. recent and future economic activity in chiba prefecture chart 1 i. current situation of and outlook for economic activity the boj's forecasts for real gdp ( july 2023 outlook report ) 580 s. a., ann., tril. yen fy 2025 + 1. 0 % fy 2023 + 1. 3 % fy 2024 + 1. 2 % fy 13 note : the forecasts presented are the medians of the policy board members'forecasts. the values of real gdp for fiscal 2023 onward are calculated by multiplying the actual figure for fiscal 2022 by all successive projected growth rates for each year. sources : cabinet office ; bank of japan. chart 2 i. current situation of and outlook for economic activity private consumption s. a., cy 2019 = 100 total real private consumption of which, services cy 15 note : figures for total real private consumption are the real consumption activity index ( travel balance adjusted ) based on staff calculations, which exclude inbound tourism consumption and include outbound tourism consumption. source : bank of japan. chart 3 i. current situation of and outlook for economic activity results of spring wage negotiations developments over time results by type of employment and firm size y / y % chg. cy 2022 cy 2023 rate of wage increase + 2. 1 % + 3. 6 % base pay increase + 0. 6 % + 2. 1 % total wage increase cy 2022 cy 2023 regular employees 2. 1 % 3. 6 % base pay increase 1, 000 or more 2. 1 % 3. 7 % regular wage increase 300 to 999 2. 0 % 3. 4 % 100 to 299 2. 0 % 3. 3 % 99 or less 1. 9 % 2. 9 % part - time employees 2. 3 % 5.