TOKYO (MNI) – In order to head off the drag from a heightened
European debt crisis, some members on the Bank of Japan board stressed
the need for the BOJ to stand ready to take action without ruling out
any options, the minutes of the May 22-23 policy meeting released on
Wednesday showed.
“A few members raised the possibility that Japan’s economy would be
adversely affected if a substantial risk materialized, stemming from the
European debt problems,” the minutes said.
“These members commented that the BOJ should therefore stand ready
to take appropriate actions without ruling out any options in advance.”
But the minutes also showed the board didn’t think it was necessary
to conduct further monetary easing in May after taking action in
February and April.
The board agreed that “it was appropriate to steadily implement the
purchases of financial assets under the program, which was expanded as a
result of the decision made at the April 27 meeting, and to monitor the
effects of these purchases.”
The BOJ board at the April 27 meeting decided to increase the scale
of the asset-buying program launched in October 2010 to Y70 trillion
from Y65 trillion.
At the May meeting, the board voted unanimously to maintain
practically zero short-term interest rates and left the scale of its
financial asset-buying program at Y70 trillion.
The BOJ has left its target for the overnight interest rate among
commercial banks at zero to 0.1% since October 2010, when it lowered it
from 0.1% as part of “comprehensive monetary easing.” The current range
is considered to be the lowest possible without hurting money market
functions.
tokyo@marketnews.com
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