haruhiko kuroda : the bank's semiannual report on currency and monetary control statement by mr haruhiko kuroda, governor of the bank of japan, before the committee on financial affairs, house of councillors, tokyo, 19 november 2019. * * * introduction the bank of japan submits to the diet its semiannual report on currency and monetary control every june and december. i am pleased to have this opportunity today to talk about developments in japan ’ s economy and present an overall review of the bank ’ s conduct of monetary policy. i. economic and financial developments in japan i will first explain economic and financial developments in japan. japan ’ s economy has been on a moderate expanding trend, with a virtuous cycle from income to spending operating, although exports, production, and business sentiment have continued to be affected by the slowdown in overseas economies. looking at this in more detail, japan ’ s exports have continued to show some weakness amid continuing slowdowns in overseas economies. on the other hand, domestic demand has increased. specifically, with corporate profits staying at high levels on the whole, business fixed investment has continued on an increasing trend. private consumption has been increasing moderately, albeit with fluctuations due to such effects as of the consumption tax hike. as for the outlook, japan ’ s economy is likely to continue on an expanding trend, as the impact of the slowdown in overseas economies on domestic demand is expected to be limited, although the economy is likely to continue to be affected by the slowdown for the time being. on the price front, the year - on - year rate of change in the consumer price index ( cpi ) has been positive but has continued to show relatively weak developments compared to the economic expansion and tight labor market conditions. with regard to the outlook, although the year - onyear rate of change in the cpi is expected to be affected by such factors as the decline in crude oil prices for the time being, medium - to long - term inflation expectations are projected to rise with the output gap remaining positive. thus, as the momentum toward achieving the price stability target is maintained, the year - on - year rate of change in the cpi is likely to increase gradually toward 2 percent. ii. conduct of monetary policy next, i will explain the bank ’ s conduct of monetary policy. the bank has been conducting powerful monetary easing under the framework of “ quantitative and qualitative monetary easing ( qqe ) with yield curve control.

bank of japan ’ s august report of recent economic and financial developments1 bank of japan, 12 august 2002 * the bank ’ s view * * japan ’ s economy, despite persistent weakness in domestic demand and increasing uncertainty regarding the global economy, has almost stabilized as a whole with exports and production continuing to increase. with regard to final demand, business fixed investment continues to decrease and private consumption, despite some resilience, remains weak as a whole. moreover, housing investment remains sluggish and public investment continues to decline. meanwhile, net exports ( real exports minus real imports ) continue to increase significantly due to the recovery in overseas economies and also to the effects of restocking abroad, mainly in it - related goods. industrial production is picking up clearly in response to the upsurge in exports and adequate reduction of excess inventory stocks. against this background, corporate profits appear to have started to recover. in addition, the rebound in production is having effects on labor markets, albeit marginally, with an increase in overtime hours worked and in new job offers mainly for part - time workers. however, firms are still maintaining their stance on reducing personnel expenses and as a consequence, household income continues to decrease noticeably. thus, employment and income situation of households overall remains severe. turning to the economic outlook, the upward trend in exports is expected to continue against the background of the gradual recovery in overseas economies, although the pace is likely to slow as the impetus from overseas restocking weakens. thus, industrial production is expected to follow a gradual uptrend with some fluctuations in its pace. on the other hand, with respect to domestic demand, public investment is projected to follow a declining trend and private demand is likely to remain weak for the immediate future. yet, if the increase in exports and production mentioned above continues, the recovery in corporate profits will become distinct, and this will gradually bring a positive impact on domestic private demand. in fact, the decline in some leading indicators of business fixed investment has come to a halt. overall, it can be envisaged that the stabilization of japan ’ s economy will become more definite as the increase in exports and production, through the improvement in corporate profits, will underpin domestic private demand. however, considering that forces restraining the economy, such as excessive labor input and debt, are still persistently at work, momentum for a self - sustaining recovery will be subdued for some time. furthermore, stock prices in the u. s. and worldwide as well as