(Reuters) – The Bank of Japan has increased its commitment to its huge stimulus program and a promise to keep interest rates low, prompting a new sell-off of the yen. This also sent government bonds rallying.

To reinforce its determination to help a fragile economy despite rising raw material costs pushing up inflation, BOJ said that it will buy unlimited quantities of 10-year government bonds in order to protect an implicit 0.25% target around zero every market day.

The BOJ’s dedication to its zero rate programme places it in conflict with other major economies, which are moving towards tighter monetary policies. However, inflation is likely to rise towards Japan’s 2% target.

Below are extracts of Haruhiko Kuroda, BOJ Governor,’s remarks at his post-meeting press conference. These were translated by Reuters.

THE YEN’S DECLINE

It is desirable that currencies move steadily and in accordance with economic fundamentals. Rapid moves in such a short time frame can create uncertainty and make it hard for businesses to plan their business.

“We don’t think we have changed our mind that the weakening yen is good for Japan’s economic health as a whole. It is also true that currency volatility could increase uncertainty among companies… which would be detrimental for the economy.

PRICE OUTLOOK and MONETARY POLICY

The consumer inflation rate will rise gradually if energy and volatile food prices are excluded. It is expected to reach 1.5% in fiscal 2024. However, this is still less than our target of 2%. If you include energy, we expect a core consumer inflation increase of 1.1% in fiscal 2024. “I don’t believe we will reach a point where we are able to exit our easy monetary policies.”