Bank of Japan board members shared the view that the effects of the aggressive easy policy launched in April 2013 are steadily working and the degree of accommodative financial environment is strengthening, the minutes of the March 10-11 policy meeting released on Friday showed.
They also agreed that real interest rates are falling on the back of a rise in inflation expectations and stable nominal interest rates, the minutes also showed.
However, one member said, “If a rise were to occur in markets’ anticipation that quantitative and qualitative easing would continue for a protracted period or extreme additional measures would be implemented in a situation where it was unlikely that the price stability target would be achieved in about two years, this could lead to economic instability in the medium to long term, such as through a buildup of financial imbalances,” they showed.