Bank of Japan minutes say aggressive easing remains path to higher consumer prices

Bank of Japan
Bank of Japan

Bank of Japan policymakers agreed to closely monitor consumer prices because they currently lack upward momentum, minutes of the central bank's March 15-16 policy meeting showed on Tuesday.

The minutes repeated earlier phrasing that over time, consumer prices will reach the central bank's 2 percent inflation target but the BOJ needs to continue with its quantitative easing, according to the minutes.

Last week on April 27, the Bank of Japan raised its economic forecasts at its policy meeting outcome on Thursday, but it kept policy steady, as was widely expected.

The BOJ has set its target yield for the benchmark 10-year Japan government bond at around zero percent, and it has been willing to intervene to keep the benchmark yield in line with its target.

That theoretically means the BOJ can buy fewer bonds as it would only need to time its purchases for when the yield curve moves away from its target.

That would help ease concerns that the central bank, which already owns more than 40 percent of all JGBs by value, would run out of bonds to buy as it continued with its planned 80 trillion yen (around $697.87 billion) annual pace of expansion of its monetary base.