* BOJ kept policy unchanged this month
* BOJ Kuroda signals easy policy is here to stay
* Next meeting is April 26-27
* Exports boosting Japan economy but domestic demand weak
(Adds details on policy)
By Leika Kihara and Stanley White
TOKYO, March 24 Bank of Japan Governor Haruhiko
Kuroda said on Friday there is "no reason" to withdraw the
bank's massive monetary stimulus now as inflation remains far
from its 2 percent target.
Kuroda also dismissed financial market concerns that at some
point in the future the BOJ will lose its ability to control
long-term interest rates under its yield-curve-control
"While some improvements have been observed in economic and
price developments, there is still a long way to go to achieve
our price target," Kuroda said in a speech at a Reuters
Kuroda added that the BOJ won't increase its bond yield
target just because overseas long-term interest rates are
rising, a scenario some traders believe is inevitable.
The BOJ maintained its short-term interest rate target of
minus 0.1 and a pledge to guide the 10-year government bond
yield at around zero percent after a policy meeting
on March 16.
It also kept intact a loose pledge to maintain the pace of
its annual increase in Japanese government bond (JGBs) holdings,
which is 80 trillion yen ($718.78 billion).
Japan's long-stagnant economy has shown signs of life in
recent months, with exports and factory output benefiting from a
recovery in global demand.
Core consumer prices rose for the first time in over a year
in January and analysts expect them to continue to pick up
slowly but steadily.
That has led to a dramatic shift in market expectations,
with a majority of analysts polled by Reuters predicting the
BOJ's next move would be to start scaling back its ultra-easy
policy, likely beginning by raising its bond yield target.
Japan's domestic demand remains sluggish, however. Household
spending fell 1.2 percent in January from a year earlier.
($1 = 111.3000 yen)
(Reporting by Leika Kihara and Stanley White; Editing by Chris
Gallagher and Kim Coghill)