The Bank of Japan will announce the results of the "inspection" of monetary easing measures after the monetary policy meeting held this week.
I would like to show a policy to enhance the effectiveness and sustainability of the current mitigation measures toward the realization of the price target of 2%, such as clarifying that there is room for further lowering the interest rate level including negative interest rates.
The Bank of Japan is continuing large-scale monetary easing with the aim of raising prices by 2%, but given that the effects of the new coronavirus have made it even more difficult to achieve the target, the monetary policy will open for two days until 19th this week. At the decision-making meeting, we will check the current mitigation measures and announce the results.
In this, I would like to clarify that there is room for further lowering the interest rate level including the negative interest rate if necessary in the future, while maintaining the current framework of keeping the short-term interest rate negative and the long-term interest rate at about 0%. It's an idea.
At that time, we will also show measures against side effects of negative interest rates, such as deterioration of profits of financial institutions.
Regarding the purchase of ETFs = exchange-traded funds made up of multiple stocks, the policy is to discuss management methods that are sharp, such as suppressing purchases when stock prices are stable, while aggressively purchasing when stock prices have fallen sharply. is.
Furthermore, it is expected that discussions will be held in the direction of clarifying the stance of allowing long-term interest rates to fluctuate within a certain range, starting from around 0%.
Through this inspection, the Bank of Japan would like to show a policy to enhance the effectiveness and sustainability of the policy toward the realization of the price target of 2% while suppressing the side effects of large-scale monetary easing measures that are being forced to take longer. It's an idea.