The Bank of Japan published the minutes of its monetary policy board meeting on September 16 and 17. At that time, they kept their monetary policy key interest rate range at zero to 0.1 percent and said it would continue to buy JGBs at an annual pace of ¥80 trillion. The vote to maintain its policy was 8 to 1. Once again, Takahide Kiuchi voted against the decision arguing that a reduced pace of purchases (¥45 trillion) was appropriate.
Some members saw the consumer price index fall on the year. They said that increased wages were necessary to hit its 2 percent price target. Some saw a high chance of 2 percent inflation in the first half of fiscal year 2016 but oil prices can change the time frame. Members said they were monitoring the impact of China's slowdown on Japan's exports. They noted that the output gap is improving slowly.
The MPB singled out emerging markets as a reason for a shift in the domestic economy's performance. In discussing developments in Japan's economy, the BoJ said exports had "recently been more or less flat", having said in August they had been "picking up, albeit with some fluctuations". Another area that had flattened out, having been picking up previously, was industrial production. However, the Bank still retained its optimistic slant that it was likely to increase moderately.
Minutes follow monetary policy board meetings with a four to five week lag. For example, minutes released on June 19 were for the meeting held on May 21 and May 22.
Investors who want a more detailed description of Bank of Japan opinions will generally read the minutes closely. The MPB may issue a statement after its monthly meeting but the minutes will be much more detailed. In particular they will reveal who voted for and against the Committee's decisions and provide a more detailed description of the MPB's thinking. As such, the minutes are a market mover as analysts parse each word looking for clues to future policy.
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