The Bank of Japan has published the minutes of the meeting of the Monetary Policy Board held March 15 and 16. At this meeting, members of the MPB left policy settings unchanged, keeping the short-term rate for excess reserves at minus 0.1 percent and retaining the target level for the 10-year government bond yield at around zero percent. Members also concluded that maintaining the BoJ's purchases of government bonds at an annual pace of Y80 trillion would be appropriate to meet their 10-year yield target.
The minutes suggest there had been little change in officials' assessment of the growth outlook since their previous meeting in January. Officials remained cautiously optimistic about near-term prospects for other maj or global economies, and agreed that the domestic economy "continued its moderate recovery trend".This recovery was again described as "more solid" in response to encouraging exports and industrial production data. Officials also expressed confidence that this recovery would evolve into a "moderate expansion" over the forecast period, reflecting a positive assessment of the outlook for exports, business investment and the labour market.
Officials' views about the inflation outlook were also little changed at the meeting. Under the BoJ's recently-adopted policy framework, officials have undertaken to keep expanding the monetary base until inflation exceeds 2.0 percent and "stays above the target in a stable manner". MPB members again argued that momentum toward achieving this target "was being maintained" but "was not yet sufficiently firm". Reflecting this assessment, a majority of members concluded that it remained appropriate to maintain "powerful monetary easing". They also repeated their view that recent increases in global long-term yields would not warrant an increase in domestic policy rates.
The policy settings retained at the March meeting were also left unchanged at the BoJ's subsequent policy meeting, held last week. The statement accompanying this meeting noted that officials continue to expect the year-on-year change in the CPI to increase towards 2.0 percent in the near-term and to meet this target sometime "around" the fiscal year starting April 2018. The minutes of last week's meeting are scheduled for publication on June 21. The BoJ's next policy meeting is scheduled for June 15 and 16.
The Bank of Japan publishes minutes following its monetary policy board meetings with a four or five week lag. The minutes expand upon the BoJ's post-meeting announcement.
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.
Once Every 3-4 weeks.