The singular attachment to inflation targeting had outstayed its welcome, Masaaki Shirakawa, the governor of the Bank of Japan, said on Thursday.

Speaking at the Economic Club of New York, Shirakawa criticised the framework, which is used and highly regarded by many central banks. Prior to the crisis, "economists focused their attention to the linkage between the output gap and the inflation rate, while awareness towards financial imbalances was limited. Factors which could not be captured