Extracts from the Bank of Japan Statement
At the Monetary Policy Meeting held today, the Policy Board of the Bank of Japan made the following decisions.
(1) The Bank publishes "the price stability goal in the medium to long term" as the inflation rate consistent with price stability sustainable in the medium to long term. The Bank judges "the price stability goal in the medium to long term" to be within a positive range of 2 percent or lower in terms of the year-on-year rate of change in the CPI and, more specifically, sets a goal at 1 percent for the time being.
(2) For the time being, the Bank will pursue powerful monetary easing by conducting its virtually zero interest rate policy and by implementing the Asset Purchase Program mainly through the purchase of financial assets, with the aim of achieving the goal of 1 percent in terms of the year-on-year rate of increase in the CPI. The Bank will continue pursuing the powerful easing until it judges that the 1 percent goal is in sight on the condition that the Bank does not identify any significant risk, including the accumulation of financial imbalances, from the viewpoint of ensuring sustainable economic growth.
(3) The Bank increases the total size of the Asset Purchase Program by about 10 trillion yen, from about 55 trillion yen to about 65 trillion yen. The increase in the Program is earmarked for the purchase of Japanese government bonds.2 By fully implementing the Program including the additional expansion decided today, by the end of 2012, the amount outstanding of the Program will be increased by about 22 trillion yen from the current level of around 43 trillion yen.
The Bank of Japan will encourage the uncollateralized overnight call rate to remain at around 0 to 0.1 percent.