Thursday, March 7, 2013
DJ: BOJ Keeps Policy On Asset-Purchase Program Unchanged
TOKYO--The Bank of Japan kept monetary policy on hold at its final policy board meeting under Gov. Masaaki Shirakawa, setting the stage for a change in leadership widely expected to adopt more aggressive easing measures.
Thursday's decision comes amid some bright signs in the economy, and is in line with forecasts by 10 analysts polled by Dow Jones Newswires, who all said the BOJ would stand pat on policy to better examine the effects of its past easing steps.
The board decided to maintain the size of the central bank's asset-purchase program--its main tool for monetary easing--at Y101 trillion by the end of the year and also voted unanimously to leave unchanged its policy rate, or the unsecured overnight call loan rate, in a 0.0%-0.1% range.
One policy board member Sayuri Shirai proposed to immediately put into effect open-ended asset purchases scheduled to begin in 2014 and to consolidate them with purchases to facilitate money market operations. Another policy board member, Ryuzo Miyao, also proposed that the bank keep its policy rate at the current level around zero until its 2% inflation target is in sight. However, the proposals from Ms. Shirai and Mr. Miyao proposals were voted down 8-1.
"The BOJ will pursue aggressive monetary easing through its virtually zero interest rate policy and asset purchases" to achieve its 2% price stability target, the central bank said in a statement released together with the announcement.
Upgrading its monthly assessment, the BOJ said "Japan's economy has stopped weakening."
The central bank said last month that Japan's economy appears to have stopped weakening.
Attention is already turning to the BOJ's next meeting in April, set to be chaired by Haruhiko Kuroda, if, as expected, his nomination as the bank's new governor is approved by parliament. Analysts see the BOJ taking additional stimulus measures under Mr. Kuroda, who has criticized the bank's past policies. Some believe there is a possibility of two consecutive rounds of easing at the April 3-4 and April 26 meetings of the policy board.
Parliament is likely to approve the nominations of Mr. Kuroda and his two deputies by March 19, when the present leadership headed by Mr. Shirakawa is due to step down.
Mr. Kuroda, currently president of the Asian Development Bank, pledged at a confirmation hearing in parliament on Monday that he would "do everything possible to get out of deflation" if approved as governor.
BOJ Gov. Masaaki Shirakawa will speak from 0630 GMT.