Members of the Bank of Japan’s monetary policy board said that the country’s economic growth is continuing at a satisfactory rate, minutes from the bank’s meeting on January 22-23 revealed on Wednesday.
The members added that exports were on a rising trend, which was helping to fuel the recovery.
According to BoJ, the economy will continue growing at a pace above its potential through fiscal 2018 at around 1.4 percent. The outlook for the fiscal 2019 was kept at 0.7 percent.
“The economy was likely to continue to see firm growth driven by domestic private demand. One member added that the economy was likely to continue growing at a pace above its potential, led by private consumption and business fixed investment,” the minutes said.
Consumer prices are expected to continue an upward trend, with the target of 2 percent still firmly in place.
Inflation is seen at 1.4 percent in the fiscal starting April, unchanged from the October outlook report. Likewise, the fiscal 2019 inflation outlook was kept at 2.3 percent. At the same time, core inflation outlook was retained at 1.8 percent for 2019.
“Some members pointed out that firms’ and households’ inflation expectations had generally stopped declining recently and market participants’ inflation expectations had started to rise,” the minutes said.
At the meeting, the bank voted to hold its target of raising the amount of outstanding JGB holdings at an annual pace of about JPY 80 trillion.
The bank will purchase government bonds so that the yield of 10-year JGBs will remain at around zero percent.
It also decided to hold the -0.1 percent interest rate on current accounts that financial institutions maintain at the bank.
“The government expected the Bank to work steadily toward achieving the price stability target of 2 percent, in light of developments in economic activity and prices, as well as financial conditions,” the minutes said.