are staff estimates and exclude the effects of the consumption tax rate hikes, and others. 2 % with a median of 1 % was consistent with its understanding of price stability before clarifying further by confirming in december 2009 that the range did not include negative values, and the boj finally introduced the price stability target of 2 % in january 2013. with hindsight, the introduction of a clear inflation target could have influenced the discussion before the boj's decision to terminate the zero - interest policy in august 2000. at that time, core inflation was still - 0. 5 percent, while forward guidance on the short rate introduced in april 1999 stated that the bank would continue the zero rate until deflationary concerns were dispelled. although it is difficult to attribute the subsequent deflation solely to the minor rate increase, the termination may have weakened the efficacy of the forward guidance. another aspect worth considering is the timing of asset purchases. the boj's active acquisition of long - term jgbs happened relatively late compared with the observed inflation dynamics ( chart 1 ). while the boj began buying more long - term jgbs with the onset of quantitative easing in march 2001, there was no significant increase in its holdings of jgbs until 2013, as shown in chart 3. by contrast, the fed's holdings of us treasury securities began to rise sharply in early 2009, in response to the global financial crisis. having said that, it should be noted that, as shown in chart 4, the 10 - year jgb yield was already below 2 % in the late 1990s, while the 10 - year treasury yield was close to 4 % when the fed initiated its large asset purchases. this prompts the question of how much impact larger - scale jgb purchases would have had in the early 2000s. the zero - inflation trap and the entrenched nature of low inflation expectations let me now turn to a second possible explanation for the boj ’ s difficulties. i think the entrenched nature of low inflation expectations played a key role ; it led to changes in economic agents'behavior, especially the strategic pricing behavior of firms, and, in turn, prolonged the period of the zero - inflation trap. as my colleagues will elaborate later, when firms do not think their peers will raise prices, they think it is best to keep their prices ( and wages ) unchanged, even in the face of small changes in costs or demand, making overall inflation or inflation expectations more entrenched

least, i hope the discussions at the conference today and tomorrow will offer some valuable takeaways for the central bank community and be of some help going forward. thank you for your kind attention. references : lagarde, christine ( 2023 ) “ policy making in an age of shifts and breaks, ” speech at the annual economic symposium “ structural shifts in the global economy ” organized by the federal reserve bank of kansas city in jackson hole, 25 august. taylor, john b. ( 2000 ) “ low inflation, pass - through, and the pricing power of firms, ” european economic review 44, 1389 - 1408. uchida, shinichi ( 2024 ) “ japan's economy and monetary policy, ” speech at a meeting with local leaders in nara, https : / / www. boj. or. jp / en / about / press / koen _ 2024 / ko240208a. htm ueda, kazuo ( 2024 ) “ on the recent changes in the bank of japan's policy framework, ” remarks at the peterson institute for international economics, https : / / www. boj. or. jp / en / about / press / koen _ 2024 / ko240502a. htm opening remarks at the 2024 boj - imes conference hosted by the institute for monetary and economic studies, bank of japan ueda kazuo governor of the bank of japan chart 1 inflation rate ( consumer price index < all items > ) 2. 5 3 - year backward moving avg., y / y % chg. 2. 0 1. 5 1. 0 0. 5 0. 0 - 0. 5 - 1. 0 cy 94 note : figures are staff estimates and exclude the effects of the consumption tax hikes, policies concerning the provision of free education, and travel subsidy programs. source : ministry of internal affairs and communications. chart 2 short - term interest rate and inflation rate 3 - year backward moving avg., y / y % chg. 5 % uncollateralized overnight call rate ( lhs ) cpi ( all items, rhs ) - 1 - 1 - 2 - 2 cy 94 note : the cpi figures are staff estimates and exclude the effects of the consumption tax hikes, policies concerning the provision of free education, and travel subsidy programs. sources : ministry of internal affairs and communications ; bank of japan. chart 3 central bank ’