In the Summary of Opinions at BoJ’s December 18-19 meeting, it’s noted there has been “no further increase” in the possibility that momentum toward achieving price target will be lost. Therefore, maintaining the current guidelines for market operations and asset purchases is “appropriate”.
Nevertheless, downside risks to economic activity and prices “continue to warrant attention”, mainly regarding overseas developments. And it’s appropriate to maintain a stance of being “tilted toward monetary accommodation”. With risks “skewed to the downside” BoJ should continue to examine “whether additional monetary easing will be necessary”.
In particular, it’s noted that BoJ expanded QQE around half a year after the previous consumption tax hike in 2014. “It may become necessary to conduct further monetary easing this time as well”.
