record highs, and the employment situation has improved substantially. wages and prices are no longer seeing a sustained decline and have turned to an uptrend. however, achieving the price stability target of 2 percent is taking more time than expected. in such a situation where economic activity and prices have improved significantly but their developments have been somewhat varied, it is appropriate to conduct monetary policy by taking account of a variety of developments in a comprehensive manner. this means that, in continuing with powerful monetary easing, we now need to consider both its positive effects and side effects in a balanced manner. the latest policy response is indeed in line with this thinking, and the bank's stance toward aiming at price stability with a view to contributing to the sound development of the national economy has not changed at all. going forward, it will continue to make its utmost efforts as a central bank, taking account of developments in economic activity and prices as well as financial conditions, and thereby firmly support corporate activities in japan. thank you very much for your attention. japan's economy and monetary policy speech at a meeting with business leaders in osaka september 25, 2018 haruhiko kuroda governor of the bank of japan chart 1 japan's economy real gdp s. a., ann., tril. yen cy 05 source : cabinet office. chart 2 exports and overseas economies projections for major economies ( imf ) real exports y / y % chg. s. a., cy 2015 = 100 world projection projection 3. 2 3. 7 3. 9 3. 9 advanced economies 1. 7 2. 4 2. 4 2. 2 united states 1. 5 2. 3 2. 9 2. 7 euro area 1. 8 2. 4 2. 2 1. 9 japan 1. 0 1. 7 1. 0 0. 9 4. 4 4. 7 4. 9 5. 1 china 6. 7 6. 9 6. 6 6. 4 asean - 5 4. 9 5. 3 5. 3 5. 3 emerging market and developing economies cy 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 notes : 1. the figure for real exports for 2018 / q3 is the july - august average. notes : 2. the post - 2018 figures in the right table are based on july 2018 weo projections. sources : imf ; ministry of finance ; bank of japan. chart 3 corporate profits and business fixed investment business fixed investment plans ( june tankan

time employee for fy 2018 is the april - july average. that for base pay increase for fy 2018 is as of july 6, 2018. sources : ministry of health, labour and welfare ; central labour relations commission ; japanese trade union confederation ( rengo ) ; bank of japan. chart 7 quantitative and qualitative monetary easing with yield curve control yield curve control % 1. 2 recent jgb yield curve 1. 0 0. 8 target level of the long - term interest rate : around zero percent 0. 6 0. 4 short - term policy interest rate : minus 0. 1 percent 0. 2 0. 0 - 0. 2 - 0. 4 residual maturity, year source : bloomberg. chart 8 strengthening the framework for continuous powerful monetary easing taking more time than expected to achieve the price stability target of 2 percent. maintaining the output gap as long as possible within positive territory is appropriate. persistently continuing with powerful monetary easing forward guidance for policy rates " the bank intends to maintain the current extremely low levels of short - and long - term interest rates for an extended period of time, taking into account uncertainties regarding economic activity and prices including the effects of the consumption tax hike scheduled to take place in october 2019. " ⇒ strengthening the commitment to achieving the price stability target enhancing the sustainability of " quantitative and qualitative monetary easing ( qqe ) with yield curve control " long - term interest rate : the bank maintains the target level of around zero percent. while doing so, the yields may move upward and downward to some extent mainly depending on developments in economic activity and prices. purchases of etfs : the bank maintains the annual pace of increase in the amount outstanding of about 6 trillion yen. while doing so, the bank may increase or decrease the amount of purchases depending on market conditions. etc. achieving the price stability target of 2 percent at the earliest possible time while securing stability in economic and financial conditions. chart 9 jgb market transaction volume for jgbs bond market survey degree of bond market functioning ( change from three months ago ) 1. 2 tril. yen / day introduction of yield curve control strengthening the framework for continuous powerful monetary easing 1. 0 di ( " has improved " - " has decreased " ), % points - 10 0. 8 - 20 0. 6 - 30 improve - 40 0. 4 - 50 - 60 0. 2 - 70 0. 0 - 80 jan. july jan. july jan. july jan. july feb. aug.