In the Summary of Opinions at BoJ’s monetary policy meeting on April 27/28, new governor Kazuo Ueda’s debut, revealed the need to continue with current monetary easing despite improved view on inflation outlook.
One member said “attention is warranted for the time being on the possibility of continued high inflation” while another said “achievement of the price stability target of 2 percent is coming into sight”. Meanwhile, “price projections have been raised somewhat”.
Yet, it’s generally agreed that the central bank “should continue with the current monetary easing,” given that inflation is likely to decline ahead, in the background of heightened uncertainties in overseas economies.
Also it’s reiterated that to achieve the inflation target in “sustainable manner”, it needs to be “accompanied by wage increases”. And it’s “necessary” to continue to “firmly support the momentum for wage hikes through monetary easing “.
There was also cautions that “the risk of missing a chance to achieve the 2 percent target due to a hasty revision to monetary easing is much more significant than the risk of the inflation rate continuing to exceed 2 percent.”
One member noted that there is no need to revise the conduct of yield curve control as “distortions on the yield curve are currently dissipating”.
