TOKYO (Reuters) - Bank of Japan Governor Haruhiko Kuroda said on Monday the country's economy was expected to continue expanding moderately, although exports and output could feel the pinch from slowing overseas demand.
He also said Japan's financial system remained stable.
"Core consumer inflation is expected to gradually accelerate toward 2 percent as the output gap remains positive, and medium- to long-term inflation expectations heighten," Kuroda said in a speech at a quarterly meeting of the central bank's regional branch managers.
Under a policy dubbed yield curve control, the BOJ guides short-term interest rates at minus 0.1 percent and the 10-year government bond yield around zero percent in an effort to achieve its 2 percent inflation target.