BOJ Struggled after 2009 Govt Declaration of Deflation

Politics

Tokyo, Jan. 29 (Jiji Press)--Bank of Japan policymakers struggled after the government declared in November 2009 that the country's economy was in deflation, the minutes of their meetings showed Wednesday.

The minutes signaled strong impacts of the word "deflation" as the central bank eased monetary policy only 11 days after the Democratic Party of Japan-led government made the declaration.

At the time, consumer prices kept falling at an annual rate of around 2 pct, and the BOJ predicted three straight years of price fall through fiscal 2011.

Politicians and academics insisted that such a situation means that the country was in deflation and criticized the BOJ for failing to take necessary measures.

At a meeting on Nov. 20, when the declaration of deflation was made, many members of the BOJ's Policy Board disputed the government's view, according to the minutes.

[Copyright The Jiji Press, Ltd.]

Jiji Press