Japan's central bank governor said Friday that the country's economy is finally close to its target inflation rate of around 2 percent.
Speaking at the World Economic Forum (WEF) in Davos, Switzerland, Haruhiko Kuroda said growth in the country is now recognized as the second biggest boom in the post-World War II era.
Japan's unemployment rate is 2.7 percent, considered by the Japanese government to be full employment. Inflation has remained stubbornly low, but the Bank of Japan governor claimed he could see progress.
"There are some indications that wages are actually rising and some prices have started to rise," Kuroda said.
"There are many factors that made the 2 percent target difficult and time-consuming but we are finally close."
Kuroda told the panel that a 15-year deflationary period, starting in 1998 and ending in 2013, had created a deflationary mindset and that people "expect that wages and prices won't rise."
Since 2012, Japan has been subject to economic policies known as Abenomics. Named after Prime Minister Shinzo Abe, it is based upon the "three arrows" of monetary easing, fiscal stimulus, and structural reforms.
Kuroda also reiterated that Japan will continue to pursue a path of monetary easing as it looks to foster growth.