The Bank of Japan (BOJ) has announced its implementation plan for a comprehensive review of monetary policy. The review aims to analyze the effectiveness of various unconventional monetary policy measures implemented over the past 25 years in relation to the economic and price conditions at different time points. It will also examine the impact of these measures, including any side effects, on financial markets and the financial system.
The review takes into account the environmental changes such as globalization and Japan’s aging population, which have influenced the behavior of businesses, households, wage dynamics, and price formation mechanisms. It also seeks to understand the implications of these changes for monetary policy.
Specific analysis themes will be flexibly considered as the review progresses.
To ensure objectivity and transparency, the BOJ plans to engage in various initiatives to incorporate diverse perspectives and enhance its analysis. These include:
- Utilizing existing surveys and reports, such as the Sakura Report, surveys on lifestyle awareness, and bond market surveys.
- Conducting company hearings at the headquarters and utilizing the research functions of branch offices.
- Seeking public comments on published materials during the review period.
- Exchanging opinions in forums like the “Financial and Economic Advisory Committee.”
- Organizing workshops, with the first workshop scheduled for December of this year, to discuss monetary policy, the financial system, and financial markets.
- Facilitating discussions on the impact of changes in the international economic environment on prices during the 10th joint conference between the University of Tokyo’s Financial Education and Research Center and the BOJ’s Research and Statistics Department in December.
- Holding a second workshop around May of next year to comprehensively discuss analyzed cases.
- Considering discussions with overseas experts on the comprehensive review at the BOJ’s 2024 International Conference organized by the Institute for Monetary and Economic Studies.
Furthermore, the BOJ has established a dedicated website for the comprehensive review, where information related to the review will be regularly updated.
The comprehensive review of monetary policy aims to enhance the understanding of the effectiveness and implications of past measures, as well as adapt to the evolving economic landscape. It represents the BOJ’s commitment to maintaining transparency and fostering a comprehensive and informed decision-making process.