Trouble on the Nikkei: What if the Bank of Japan Can't Get the Inflation Rate Up to 2%?

Here are some of this morning's headlines:

Most Asian Stock Markets Up, But Nikkei Falls
World stocks slightly up, Nikkei down as yen gains
Asia markets mixed, strong yen hits Nikkei
Nikkei falls to 3-week low on profit-taking; BOJ meeting eyed
Nikkei sheds 1.8 pct, drops below 12000 for 1st time in 3 weeks

And from FT Alphaville, a thought that Central Bankers dare not think:

Expectations management for the BoJ

We’ve used that kind of header before… but Abe is forcing us to crack it out again. From the FT on Tuesday:

Japanese Prime Minister Shinzo Abe has said that the 2 per cent inflation target he imposed on the Bank of Japan may not be reached within two years…
In an exchange with Seiji Maehara, an opposition politician and former economy minister, Mr Abe said the BoJ should not pursue the inflation target “at all costs”.

That is the first time Abe has suggested the inflation target he set out four months ago may not be met within the two-year timeframe outlined by Kuroda, his choice for Bank of Japan governor. And it comes just ahead of a very pivotal BoJ meeting. Alan Ruskin from Deutsche Bank laid out the policy measures which are widely expected by the market...MUCH MORE

The last five days of action:

Yahoo Finance
12,003.43 Down 131.59, last. That's after hitting 12,650.26 on March 21, a better-than-5% drop.