BoJ: Long-term inflation slowly converges towards 2%

Tuesday, 25. June 2019 02:22

The Bank of Japan (BoJ) released on Tuesday the minutes of its April meeting, in which it stated that it will keep its monetary policy of providing funds through the purchase of government bonds unchanged. As a short-term policy, the BoJ will continue to apply a 0.1% negative interest rate, while the ten-year bond yield curve should remain consistent with the market expectations. According to the meeting report, medium and long-term inflation is expected to rise and should gradually converge towards 2%.

Most members of the BoJ Policy Board agreed that, although it would take time to achieve the 2% price stability target, it is appropriate to "continue with the current powerful monetary easing." With regard to asset purchases other than Japanese sovereign debt, BoJ members said the bank will acquire, among other things, exchange-traded funds for around ‎¥6 trillion annually.

BoJ's monetary policy meeting minutes from April indicate that the overseas economies are growing moderately on the whole, although Japan's central bankers observe some slowdowns, which are likely to continue for the time being. BoJ added that the European economy has been decelerating in the past months, while the Chinese economy continued to grow, despite "relatively weak developments."

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