Wednesday , 28 February 2024

BOJ : Statement on Monetary Policy

October 5, 2012
Bank of Japan
Statement on Monetary Policy
1. At the Monetary Policy Meeting held today, the Policy Board of the Bank of Japan
decided, by a unanimous vote, to set the following guideline for money market
operations for the intermeeting period:
The Bank of Japan will encourage the uncollateralized overnight call rate to remain at
around 0 to 0.1 percent.
2. Overseas economies have moved somewhat deeper into a deceleration phase. In
global financial markets, while investors have remained somewhat less risk averse on
the back of the European debt problem, particular attention should be given to
developments in these markets.
3. Japan’s economic activity is leveling off more or less. Exports and industrial
production have been relatively weak as overseas economies have moved somewhat
deeper into the deceleration phase. On the other hand, domestic demand has been
resilient, mainly supported by reconstruction-related demand. Specifically, public
investment has continued to increase, and housing investment has generally been
picking up. Private consumption has been resilient with the employment situation on
an improving trend. Business fixed investment has been on a moderate increasing
trend as corporate profits have improved on the whole. As for business sentiment,
firms have turned somewhat cautious mainly against the background of the
deceleration in overseas economies. Financial conditions in Japan are accommodative.
On the price front, the year-on-year rate of change in the CPI (all items less fresh food)
is around 0 percent.
4. With regard to the outlook, Japan’s economy is expected to level off more or less for
the time being, and thereafter, it will return to a moderate recovery path as domestic
demand remains resilient and overseas economies gradually emerge from the
deceleration phase. The year-on-year rate of change in the CPI is expected to remain
at around 0 percent for the time being.
5. Regarding risks, there remains a high degree of uncertainty about the global economy,
including the prospects for the European debt problem, the momentum toward recovery
for the U.S. economy, and the likelihood of emerging and commodity-exporting
economies simultaneously achieving price stability and economic growth.
Furthermore, attention should be paid to the effects of financial and foreign exchange
market developments on economic activity and prices.
6. The Bank recognizes that Japan’s economy faces the critical challenge of overcoming
deflation and returning to a sustainable growth path with price stability. This
challenge will be met through efforts by a wide range of economic agents to strengthen
the economy’s growth potential and support from the financial side. Based on this
recognition, the Bank has been providing support to strengthen the foundations for
economic growth and pursuing powerful monetary easing. It will proceed with the
monetary easing in a continuous manner by steadily increasing the amount outstanding
of the Asset Purchase Program. The Bank continues to conduct monetary policy in an
appropriate manner. The Bank will also do its utmost to ensure the stability of Japan’s
financial system, while giving particular attention to developments in global financial
Meeting hours:
October 4: 14:00-17:04
October 5: 8:59-12:09
Policy Board members present:
Masaaki Shirakawa (Governor)
Hirohide Yamaguchi (Deputy Governor)
Kiyohiko G. Nishimura (Deputy Governor)
Ryuzo Miyao
Yoshihisa Morimoto
Sayuri Shirai
Koji Ishida
Takehiro Sato
Takahide Kiuchi
(Others present)
October 4
From the Ministry of Finance:
Shinichi Sato, Deputy Vice Minister for Policy Planning and Co-ordination
From the Cabinet Office:
Kenji Matsuyama, Vice-Minister for Policy Coordination (14:00-17:04)
October 5
From the Ministry of Finance:
Koichi Takemasa, Senior Vice Minister of Finance (8:59-12:00,12:04-12:09)
From the Cabinet Office:
Kenji Matsuyama, Vice-Minister for Policy Coordination (8:59-10:56)
Seiji Maehara, Minister of State for Economic and Fiscal Policy
Release of the Monthly Report of Recent Economic and Financial Developments:
14:00 on Tuesday, October 9 (Japanese)
16:30 on Wednesday, October 10 (English)
— The English translation of the summary of the Monthly Report will be
released at 14:00 on Tuesday, October 9
Release of the minutes:
8:50 on Friday, November 2

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