In the summary of opinions of BoJ’s April 27 meeting, it’s warned that a “rapid economic contraction not seen since the Great Depression in the 1930s may occur in the short run”. And, policy authorities “must act decisively to avoid a second Great Depression”. Close cooperation between fiscal and monetary policies is “essential at the time of a significant economic crisis”.
It’s also noted the assumptions that the pandemic will subside soon and “economic structure before and after that happens will not change”. However, due to “extremely high uncertainties”, it’s necessary for BoJ to factoring in the “such assumptions might not be realized”.
