Central banks should learn from the Bank of Japan’s experience before raising their inflation targets, a Federal Reserve economist argues.

Taisuke Nakata analyses the impact of the BoJ’s 2013 move to raise its inflation target from 1% to 2%.  

Nakata argues the Japanese experience shows that central banks must demonstrate their ability to achieve the old target first if they hope to convince the public the new, higher target is attainable.

The Bank of Japan raised its target to 2% when