cpi inflation rate ( excluding fresh food ) turned positive in june for the first time in 14 months, accelerating to plus 0. 8 percent. the outlook for economic activity and prices has improved and stock prices have risen by more than 30 percent since the beginning of the year. while these should be factors that lead to increases in long - term interest rates, japan ’ s long - term interest rates have declined from about 0. 8 percent as of the beginning of the year to less than 0. 7 percent. these rates have declined since end - may, even in a situation of long - term interest rates in the united states and many other countries having substantially increased across the board. the break - even inflation rate and expected inflation rates judged from various surveys have been increasing. thus, the qqe has been exerting its intended effects and japan has been steadily moving toward overcoming deflation. concluding remarks the qqe is an unprecedented policy, in that it aims to increase inflation expectations in a situation where there is no room to further reduce nominal interest rates. while this is a daunting challenge, developments thus far have been encouraging. with the aim of achieving the 2 percent price stability target, the boj will continue with the qqe as long as it is necessary for maintaining that target in a stable manner. thank you for your attention. bis central bankers ’ speeches

haruhiko kuroda : quantitative and qualitative monetary easing remarks by mr haruhiko kuroda, governor of the bank of japan, at the international council meeting of the bretton woods committee, washington dc, 10 october 2013. * * * introduction it is my honor to take part in this wonderful meeting as a panelist today. when i first looked at the list of questions prepared by the committee to shape my remarks, i was stunned by the sheer number and scope of the questions. this points to the fact that we are surrounded by daunting challenges in this interconnected world, and it is our responsibility to sincerely meet those challenges. given the time constraints today, my focus will naturally be on monetary policy. the steering of policy has become increasingly difficult in recent times, and many of my fellow central bankers have found themselves in uncharted waters. since the outbreak of the lehman crisis, major central banks around the globe have introduced unconventional monetary policy measures, including asset purchases, amid the constraints of a zero lower bound for nominal interest rates. the bank of japan has also implemented unconventional monetary policy several times, since more than a decade ago, and has successfully accumulated ample experience. however, we have not been successful in overcoming deflation. to this end, in april, immediately after i became the governor of the boj, we introduced quantitative and qualitative monetary easing, dubbed the qqe. the qqe is markedly different from the policies the boj implemented in the past and from unconventional monetary policies other central banks have been carrying out. today, in the time allotted to me, i would like to explain the uniqueness of the qqe. challenges and economic situation japan ’ s economy has been mired in deflation for the past 15 years. in the meantime, people ’ s inflation expectations declined and the recognition that prices will not increase – namely, deflationary expectations – became entrenched. amid the situation of prices not increasing, the holding of cash or deposits became a better investment, and thus firms and households hoarded cash and did not make other productive investments. persistent deflation encouraged behavior to stay status quo, and this deprived japan ’ s economy of vitality. there were phases of economic recovery in the meantime, but they did not lead to a sustainable increase in prices. the phillips curve, which shows the relationship between the output gap and inflation, shifted downward in tandem with a decline in inflation expectations. the average inflation rate