Bank of Japan Governor Haruhiko Kuroda said on Tuesday the central bank has entered a phase where it must consider not just the merits but the side-effects of its massive stimulus programme in a “balanced manner”.

He also said the BOJ's new commitment to keep interest rates very low for an “extended period” did not mean near-zero rates will be maintained permanently, reminding markets that the central bank could raise rates if the inflation rate picks up.

“We hope to achieve 2 percent inflation at the earliest date possible by maintaining our powerful monetary easing, so that we can begin normalising monetary policy,” Kuroda said.

Kuroda said that while he would not rule out changing the commitment, it was an appropriate one for now as inflation remains distant from the BOJ's target.