The Bank of Japan plans to assess at its monetary policy meeting on 29 and 30 October whether the inflation rate has reached the 2% target, it became known on the 21st. If the target is deemed to have been reached, the decision is expected to signal a shift away from the response to deflation.
At its next monetary policy meeting, the Bank of Japan will assess whether the inflation rate has reached the 2% target it has pursued. If the target has not been reached, the prevailing view is that the current accommodative monetary policy stance will be maintained, but reports indicate that confirmation of achievement could raise the prospect of a shift away from the long-running response to deflation.
Even if the achievement of the price target becomes public, many market participants believe that interest rates are highly likely to remain unchanged going forward. The direction of policy could be reassessed depending on the Bank of Japan’s decision, but no information currently suggests a major change in interest rates.