The Bank of Japan and the government have agreed to set 2 percent inflation as the central bank's policy target in a joint statement likely be issued next week, although no clear timeframe has been fixed to meet the goal, a deputy economics minister said on Friday.
The government will examine progress on efforts towards achieving the target through its top policy panel, the Council on Economic and Fiscal Policy, Yasutoshi Nishimura, senior vice-minister of the Cabinet Office, told Reuters in an interview.
The council meetings are held regularly and attended by BOJ Governor Masaaki Shirakawa. The panel has the legal authority to set medium- to long-term economic and fiscal policies.
Nishimura serves as deputy to Economics Minister Akira Amari, who has the right to attend the Bank of Japan's policy-setting meetings. The government has been pressuring the central bank to do more to beat deflation.
Under intense pressure from Prime Minister Shinzo Abe, the central bank will double its inflation target to 2 percent and consider easing policy again through an increase in its asset-buying and lending programme next week, sources have told Reuters.
The joint statement is likely to be issued on Tuesday when the government's top policy council meets after the central bank's two-day policy meeting that ends the same day, Nishimura said.