Tokyo: Bank of Japan policymakers at a September meeting offered opinions about normalization from the current ultraeasy monetary policy, minutes of the meeting showed on Monday.
One BOJ Policy Board member said it was important “from a risk management perspective to prepare and lay the groundwork for an exit from the current monetary policy” in terms of improving market functioning and communicating with the market and society, according to the minutes.
The BOJ decided to keep its ultraeasy monetary policy unchanged at the Sept. 21-22 meeting, after effectively raising the cap on 10-year Japanese government bond yields to 1 percent from 0.5 percent at the preceding July meeting.
In October, the central bank decided to allow 10-year JGB yields to top 1 percent.
At the September meeting, some policymakers mentioned the timing of determining whether the BOJ’s 2 percent inflation target will be achieved.
One member said the achievement of 2 percent inflation in a sustainable and stable manner “seemed to have clearly come in sight” and that the BOJ might be able to determine around January to March next year whether it would be achieved.
Another emphasized that the Japanese economy was “getting closer to achieving the price stability target” and the October-March second half of fiscal 2023 would be an important period for determining whether the target would be achieved.
Some members pointed to changes in company behavior on setting wages and prices. One said a virtuous cycle that leads to price rises accompanied by wage growth was emerging.
Members shared the recognition that the BOJ “could not decide on any details” at the moment about the timing of and specific measures for policy revision, citing high uncertainties resulting from their dependence on developments in economic activity and prices.