Japan Monetary Policy


Japan: Bank of Japan reinforces positive outlook on economic recovery and inflation developments

September 5, 2013

At its 4-5 September monetary policy meeting, the Bank of Japan (BoJ) decided to leave the monetary policy rate unchanged. The Bank also unanimously decided to continue implementing money market operations so that the monetary base - its main policy instrument - will increase at an annual pace of between JPY 60 and 70 trillion (approximately USD 624 and 727 billion). This decision was in line with market expectations.

In its accompanying statement, the Central Bank emphasized that the economy is "recovering moderately" and is expected to continue to do so, thanks to gradual improvements both domestically and abroad. In terms of price developments, the Bank stated that CPI is within its target range and that, "inflation expectations appear to be rising on the whole." The Bank anticipates that its monetary easing operations will contribute to further positive economic developments and to a reversal of the deflationary problems that have persisted for more than a decade.

All of the FocusEconomics Consensus Forecasts panelists expect the collateralized overnight call rate to remain unchanged at between 0.0% and 0.1% both this year and next.

Author:, Economist

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Japan Monetary Policy Chart

Japan Monetary Policy September 2013

Note: Collateralized overnight call rate in %.
Source: Bank of Japan (BoJ).

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