Memo to the BoJ: We Can Read the Small Print *And* The Large Print
BoJ-bashing is too easy.
Incongruous statements from the Bank of Japan last night, part one:
For the time being, the year-on-year rate of change in the CPI is expected to turn negative due to the reversal of the previous year’s movements in energy-related and durable consumer goods, and thereafter, it is likely to be around 0 percent again.
The Bank recognizes that the inflation rate consistent with price stability on a sustainable basis will rise as efforts by a wide range of entities toward strengthening competitiveness and growth potential of Japan’s economy make progress. Based on this recognition, the Bank
has set the price stability target at 2 percent in terms of the year-on-year rate of change in the CPI.
And part two;
Under the price stability target specified above, the Bank will pursue monetary easing and aim to achieve this target at the earliest possible time.
Yet the footnotes show they voted against easing policy right now:
With regard to JGB purchases under the Asset Purchase Program, Ms. S. Shirai proposed to immediately put into effect the open-ended asset purchasing method and consolidate them with those conducted for facilitating money market operations. The proposal was defeated by a majority vote. Voting for the proposal: Ms. S. Shirai. Voting against the proposal: Mr. M. Shirakawa, Mr. H. Yamaguchi, Mr. K. G.
Nishimura, Mr. R. Miyao, Mr. Y. Morimoto, Mr. K. Ishida, Mr. T. Sato, and Mr. T. Kiuchi.
Mr. R. Miyao proposed to continue with a virtually zero interest rate policy until the Bank judges the achievement of the price stability target to be in sight. The proposal was defeated by a majority vote. Voting for the proposal: Mr. R. Miyao. Voting against the proposal: Mr. M. Shirakawa, Mr. H. Yamaguchi, Mr. K. G. Nishimura, Mr. Y. Morimoto, Ms. S. Shirai, Mr. K. Ishida, Mr. T. Sato, and Mr. T. Kiuchi.