MNI BRIEF: BOJ Says Premature Policy Change Undesirable

One Bank of Japan board member said that it is undesirable for the BOJ to prematurely change its monetary policy as such a move risks disrupting the formation of a virtuous cycle between prices and wages, according to Tuesday's release of the Summary of Opinions from the October 27-28 meeting.

Another member said: “The BOJ needs to carefully explain that, as inflation targeting policy should be based on the inflation outlook, it conducts the policy by assessing the outlook for prices, rather than temporary price fluctuations, with the aim of achieving the price stability target of 2 percent in a sustainable and stable manner.” (See MNI BRIEF: BOJ's Kuroda Says Easy Policy Most Appropriate)

“Although there is no need to immediately change monetary policy, it is necessary to examine the impact of high prices on household behavior and wages humbly and without any preconceptions while paying attention to the side effects of monetary easing,” said a different member.

Another member said, “It is also important to continue to examine how future exit strategies will affect the market and whether market participants will be well prepared for them.”