Japanese Finance Minister Katayama says the government will consider the specific amount and how to handle the surplus arising from the BoJ's ETF sales during budget formulation

• Government reached complete agreement one to two months ago that Japan is no longer in a deflationary situation.
• It is about time to judge that the BoJ's 2% inflation target has been largely achieved.

Remarks of this kind from a Japanese finance minister sit at the intersection of fiscal management and the long tail of the BoJ's easing programme, and the two strands behave differently. The ETF sale proceeds point is primarily administrative: since the BoJ began offloading its accumulated equity holdings, the question of how the surplus is treated in budget formulation is a sequencing and accounting matter, not a signal of faster or slower disposal, and history argues the pace of sales is set by the BoJ's own caution about market disruption rather than by the ministry's plans for the proceeds. The more consequential strand is the declaration that deflation is over and the inflation target largely achieved, a characterisation that successive governments have approached gradually because formalising it removes the political cover for ultra-loose policy and shifts the burden onto the BoJ to normalise. In past episodes of this kind, the finance ministry has tended to trail the central bank rather than lead it, so the tell is whether BoJ officials echo the language and whether wage and price data sustain the claim. Attention falls on the next policy meeting communication and any coordination between ministry and bank messaging. As commentary rather than decision, the signal is directional for the rates path and the yen, not mechanical.