Bank of Japan

September 15, 2015

The statement released this month by the BOJ Board after 5 hours 36 minutes of policy deliberations over two days break little new ground regarding whether policy stimulus might be augmented, as such was at end-October 2014, following next month’s full outlook review.  The assessment of exports and industrial production were downgraded, but the upbeat prognosis for moderate economic recovery and attainment of 2% core inflation sometime in 2016 were not modified.  The vote in favor of the status quo was again 8-1, with Kiuchi favoring a less accommodative stance and policy framework.  The central bank is buying long-term JGBs at a pace of 80 trillion per year (about $670 billion), but core inflation is hovering at zero.  The rise to 2% is contingent upon oil prices rising above present levels.  It’s not clear that more aggressive monetary policy could achieve the inflation goal, given the lack of success thus far.  This month’s press conference dwelled less on the yen than last month’s.

Copyright 2015, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.



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