BoJ April meeting summary of opinions: Continues to be risk Japan may slide into recession - RTRS

The BoJ April meeting and Summary of Opinions states that there continues to be risk Japan may slide into recession depending on sales tax hike impact, overseas developments.

Key points:

• Uncertainty on price outlook will persist through fiscal 2021;
• Must scrutinise whether Japan is in a protracted situation where soft inflation weighing on inflation expectations, vice versa;
• Must maintain current easy policy with eye on side-effects, also need monetary and fiscal policy mix toward fiscal 2021;
• Must always think about ways to boost sustainability of policy framework;
• Appropriate to review forward guidance on interest rates due to heightening overseas uncertainties;
• Such as by mentioning time frame on how long BoJ will keep rates very low;
• Must ease policy further decisively, flexibly if momentum for achieving price target lost;
• Must carefully balance benefits, costs of monetary easing;
• Further declines in interest rates could aggravate demerits of monetary easing more than boosting economy.