In the summary of opinions of BoJ’s June 17-18 meeting, it’s reiterated that the economy has “picked up as a trend” although it remains in a “severe situation”. A “virtuous cycle” has “started to operate”, partly owing to the progress with vaccinations. The economy is “likely to recover” with impact of COVID-19 “waning gradually”.
Also, as vaccinations have been “progressing rapidly of late”, the economy is expected to “to a certain extent in the short run, mainly due to an expansion in pent-up demand for consumption of face-to-face services”.
Also, members noted that “until it becomes certain that the impact of COVID-19 has subsided, it is important to steadily continue with policy responses”. Financing of firms is “likely to remain under stress”. Face-to-face services consumption will be “constrained” and there remains a risk that “concern over financing will emerge”. Hence, it’s desirable to extend the duration of the Special financing program by six months.
