Bank of Japan: No Change at Shirakawa’s Last Policy Meeting

March 7, 2013

The March meeting of the Bank of Japan Policy Board, comprising six hours of deliberations over two days, presented no fresh initiatives, keeping a 0-0.1% overnight interest rate target and a JPY 101 trillion ceiling on quantitative easing.  This was the final meeting to be led by Governor Shirakawa.  Both he and the two deputy governors will be replaced next month.  The Board’s statement upgraded its economic assessment from “weakening appears to have stopped” to a more confident “weakening has stopped,” but officials stressed that several downside risks remain.  The statement reiterated the present Board’s misgiving that heavy quantitative easing could cause unwanted negative consequences.  The new leadership will be less deterred by that possibility and is expected to ease policy further in April.

Copyright 2013, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.

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