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Japan's central bank chief vows to end deflation

  • Associated Press
  • March 21, 2013 - 3:46 AM

TOKYO - The newly installed governor of Japan's central bank said Thursday that he plans to do whatever he can to end deflation and break the economy out of the doldrums.

After a meeting with Prime Minister Shinzo Abe, Haruhiko Kuroda told reporters he had reiterated his pledge to "do everything we can to get the economy out of deflation."

Abe and some experts view years of falling prices, which tend to discourage corporate investment, as a key reason for Japan's economic stagnation over the past two decades. However there are doubts about how much looser monetary policy can help after years of near-zero interest rates.

Kuroda took office on Wednesday, succeeding Masaaki Shirakawa, who stepped down three weeks before his five-year term was to end.

Kuroda, a Finance Ministry veteran who most recently headed the Asian Development Bank, has firmly backed Abe's economic strategy including setting a 2 percent inflation target which he says he hopes to meet within two years.

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