BOJ Minutes Disclosure Struggling to Respond to Government's Deflation Judgment January 29, 2009 11:10
The Bank of Japan released the minutes of the monetary policy meeting at the time of the change of government in 2009. At the time, while the government determined that the Japanese economy was in deflation, the Bank of Japan continued to worry that using the term deflation would worsen the psychology of individuals and businesses rather than responding I can see
The minutes released from July to December 2009 were when the administration of Hatoyama was established, led by the former Democratic Party.
The economy, which fell during the Lehman Shock the previous year, was recovering, but prices continued to fall, and in November of that year, the government determined that the Japanese economy had fallen into deflation.
However, at the meeting of the Bank of Japan held on the same day, participants said, "If you repeat deflation, deflation will cause people to feel deflation" or "the words will walk alone". One after another, the use of the term deflation could worsen the psychology of individuals and businesses, suggesting that they were struggling to respond.
Governor Masaaki Shirakawa said, "The Bank of Japan is no different from what the Bank has shown before," and reluctant to use the term "deflation."
In the end, Governor Shirakawa acknowledged that the country had fallen into gradual deflation, and the following day, a special meeting was held in December to take further monetary easing.
The Bank of Japan has been undergoing massive monetary easing for more than a decade since then, but has fallen short of its 2% inflation target.