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    BOJ minutes provide no clue on further easing

    Minutes from the Bank of Japan’s April policy meeting showed some members expressed misgivings over its negative interest rate policy.

    Still, most members agreed that policy effects from its monetary easing with a negative interest rate would spread steadily to economic activity and that it was appropriate to examine the extent of their permeation because it could take some time for effects to become apparent, the minutes said.

    The BOJ kept its monetary policy unchanged at the meeting, imposing a minus 0.1 percent charge on some of the reserves held by financial institutions at the central bank. It again pushed back the time frame for achieving its 2 percent inflation target by six months and now aims to attain that goal in fiscal 2017.

    However, the minutes provided no clues on whether the BOJ will ease its policy further. As members are worried about impact of negative rates it seems that this scenario is less likely, but it all depends on the Brexit referendum. 

     

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