Bank of Japan

September 5, 2013

A comparatively short five hour 7 minute policy board meeting over two days ended with the released of an unremarkable statement that mimicked the August statement in terms of policy description (planned actions and their likely duration).  There was no change in voting pattern:  9-0 in favor of continuing the quantitative easing and 8-1 rejecting a proposal to limit the current policy to no more than two years.  The majority left timing open to however long it takes to secure at-target 2% inflation in a stable manner.  The statement upgrades the overall economic assessment to “recovering moderately” and upgrades the view of business fixed investment to “starting to pick up.”  Core inflation has risen to between 0.5% and 1.0%, and expected inflation appears to be rising. Growth risks are the same as before: Europe’s debt difficulties, recent developments in emerging and commodity-exporting economies, and U.S. growth uncertainties.  The next policy meetings are scheduled October 3-4 followed by October 31 which will coincide with the release of new macro forecasts.

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



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