Bank of Japan Gov. Toshihiko Fukui said Thursday the central bank’s ultraloose monetary policy will not be affected even if the bank lowers its current account deposit balance target in the future.
“Even if we lower (the liquidity target), it will not be a monetary tightening but an adjustment to make the quantitative monetary-easing framework last,” Fukui said at a session of the House of Councilors Financial Affairs Committee.
Fukui was responding to Tsutomu Okubo, a Democratic Party of Japan member, who had asked about the prospects of lowering the current account balance target in the future.
The central bank Wednesday kept the amount of reserves available to lenders at between 30 trillion yen and 35 trillion yen.
Fukui Thursday repeated a vow to keep the ultraloose policy until core consumer prices stop falling at least for a few months and policymakers are confident they will not resume declining. The bank was “firmly” committed to these guidelines, he said.
“I won’t deny that there could be some adjustment should ignoring changes in the market cause contradictions in the maintenance of quantitative easing,” Fukui said.
Ueda leaves BOJ
Kazuo Ueda, a leading theorist on the Bank of Japan Policy Board, left the board Thursday after seven years of service.
During his seven years, the central bank adopted the unconventional monetary policies of zero interest rates and quantitative easing.
Ueda was named BOJ Policy Board member in April 1998 after teaching at the University of Tokyo.
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