, in response to changes in the environment. however, there has been absolutely no change in its commitment to achieving the price stability target of 2 percent at the earliest possible time. i believe that " qqe with yield curve control, " consisting of an " inflation - overshooting commitment " and " yield curve control, " is the best possible framework that we can devise at present, given the situation in japan - - the formation mechanism of inflation expectations, transmission channels of monetary easing, and the conditions in the financial system. under this framework, the bank will realize the maximum effects of monetary easing. thank you very much for your attention. " quantitative and qualitative monetary easing with yield curve control " : after half a year since its introduction speech at a reuters newsmaker event in tokyo march 24, 2017 haruhiko kuroda governor of the bank of japan chart 1 developments in international financial markets crude oil prices ( wti ) stock prices in major economies the beginning of 2014 = 100 japan ( nikkei 225 stock average ) united states ( s & p 500 ) $ / bbl europe ( euro stoxx 50 ) jan - 14 jul - 14 source : bloomberg. jan - 15 jul - 15 jan - 16 jul - 16 jan - 17 jan - 14 jul - 14 jan - 15 jul - 15 jan - 16 jul - 16 jan - 17 chart 2 inflation expectations after the introduction of qqe 2. 0 y / y % chg. beginning of a introduction of consumption downtrend in qqe tax hike crude oil prices 1. 8 synthetic indicator of firms ', households ', and economists'inflation expectations 1. 6 [UNK] [UNK] destabilization of financial markets amid concern about emerging economies [UNK] 1. 4 1. 2 1. 0 0. 8 0. 6 0. 4 0. 2 cy 07 notes : 1. inflation expectations of firms, households, and economists are represented by the tankan, the " opinion survey, " and the " consensus forecasts, " respectively. notes : 2. semiannual data from the " consensus forecasts " up through 2014 / q2 are linearly interpolated. " opinion survey " figures exclude inflation expectations by respondents whose annual inflation expectations were + 5 % percent or greater and - 5 % percent or smaller. the output prices di in the tankan represents the difference between the share of firms that raised prices in the preceding three months and the share of firms that lowered prices. sources :

march 24, 2017 bank of japan " quantitative and qualitative monetary easing with yield curve control " : after half a year since its introduction speech at a reuters newsmaker event in tokyo haruhiko kuroda governor of the bank of japan introduction i would like to express my sincerest gratitude for the opportunity today to explain the bank's monetary policy. half a year has passed since the bank introduced " quantitative and qualitative monetary easing ( qqe ) with yield curve control " in september 2016. this new framework has been working smoothly. today, looking back at developments in the global economy and the global financial markets since 2015, i would like to explain the background to and thinking behind the adoption of the new policy framework, following the introduction of a negative interest rate. then, i would like to talk about the current situation of and outlook for japan's economy, as well as the bank's stance on monetary policy going forward. i. the background to the adoption of " qqe with yield curve control " and thinking behind it a. turbulence in global financial markets and the introduction of a negative interest rate turbulence in global financial markets let me look back at developments in the global financial markets since summer 2015. investors'risk sentiment started to worsen against the background of the slowdown in emerging economies, including china, and uncertainties regarding those economies. in particular, after the turn of 2016, the global financial markets rapidly became destabilized due to heightened concerns regarding emerging economies, which were triggered by the significant decline in the shanghai stock prices ( chart 1 ). the decline in commodity prices, including crude oil prices, exacerbated the situation. under such circumstances, pessimistic views about the outlook for the global economy prevailed, such as the " secular stagnation " hypothesis. major economies faced the common policy challenges of how to address low growth, as well as low inflation under low interest rates, and this topic was hotly debated at international fora such as the group of twenty ( g - 20 ) finance ministers and central bank governors meeting. naturally, such headwinds for the global economy had a significant negative impact on japan's economy as well. in financial markets, the yen appreciated and stock prices declined. on the inflation front, the year - on - year rate of change in the consumer price index ( cpi ) excluding fresh food turned negative in 2016 for the first time in three years, due to the effects of the decline