BoJ Ueda says expect rates to stay low even after recent policy shift

Japan's economy showing some weakness, but recovering moderatelyChance of solid wage growth this year heighteningInflation likely to exceed 2% this fiscal year, slow thereafterMust watch fx, market developments and their impact on economy, prices Trend inflation likely to gradually accelerate towards end of current forecast period under quarterly reportBoJ will guide policy appropriately with eye on economy, price developments with short-term rate as policy targetBoJ expects accommodative monetary conditions to continue for time beingExpects consumption to increase gradually as wage gains push up household incomeTemporary factors that are weighing on consumption likely to dissipate Important to maintain accommodative monetary conditions as trend inflation yet to hit 2%If economy, price developments proceed as we project now, we need to think about reducing degree of monetary supportWhether this will happen will depend on upcoming data Have no preset idea now on how and when we will adjust interest rate levels Even after march policy shift, expect interest rates to stay low, real interest rates to remain at deeply negative territoryExpect to reduce our bond buying in future but can't say now when and by how muchWon't immediately start unloading BOJ's ETF holdings This article was written by Arno V Venter at www.forexlive.com.