MNI BRIEF: Signs Point to 2% Price Target - BOJ Minutes

A few Bank of Japan board members pointed to positive signs the Japanese economy could achieve the BOJ's 2% price target at the March 9-10 meeting, according to the minutes released Monday.

However, one member noted "there was still a long way to go" before it could be shown prices were consistently pushing up wages. Another member said, in order for progress to be made in supply-side reforms to support sustained wage increases, the BOJ needed to persist with monetary easing.

“The member continued that, however, taking into consideration the importance of resolving the long-standing challenge of shifting the norm for prices, the risk from a hasty policy change that could lead to missing a chance of achieving the price stability target should be considered as more significant than the risk from a delay in policy change.”

Many board members also noted bond market functioning had deteriorated and the BOJ must continue monitoring market developments and the impact from JGB yields on corporate bonds. Board members said the transmission of monetary easing on the real economy must be sustainable and the BOJ should, if necessary, work to improve market functioning, including the corporate bond and swap markets.