Bank of Japan : Minutes of the Monetary Policy Meeting on October 27 and 28, 2022

Not to be released until 8:50 a.m.

Japan Standard Time on Friday,

December 23, 2022.

December 23, 2022

Bank of Japan

Minutes of the

Monetary Policy Meeting

on October 27 and 28, 2022

(English translation prepared by the Bank's staff based on the Japanese original)

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Secretariat of the Policy Board, Bank of Japan

P.O. Box 30, Nihonbashi, Tokyo 103-8660, Japan

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A Monetary Policy Meeting of the Bank of Japan Policy Board was held in the Head Office of the Bank of Japan in Tokyo on Thursday, October 27, 2022, from 2:00 p.m. to 4:12 p.m., and on Friday, October 28, from 9:00 a.m. to 11:43 a.m.1

Policy Board Members Present

Mr. KURODA Haruhiko, Chairman, Governor of the Bank of Japan Mr. AMAMIYA Masayoshi, Deputy Governor of the Bank of Japan Mr. WAKATABE Masazumi, Deputy Governor of the Bank of Japan Mr. ADACHI Seiji

Mr. NAKAMURA Toyoaki

Mr. NOGUCHI Asahi

Ms. NAKAGAWA Junko

Mr. TAKATA Hajime

Mr. TAMURA Naoki

Government Representatives Present

Mr. OKU Tatsuo, Deputy Vice-Minister for Policy Planning and Coordination, Ministry of Finance

Mr. INOUE Hiroyuki, Vice-Minister for Policy Coordination, Cabinet Office

Reporting Staff

Mr. UCHIDA Shinichi, Executive Director

Ms. SHIMIZU Tokiko, Executive Director (Assistant Governor)

Mr. KAIZUKA Masaaki, Executive Director

Mr. SHIMIZU Seiichi, Executive Director

Mr. NAKAMURA Koji, Director-General, Monetary Affairs Department

Mr. KAMIJO Toshiaki, Deputy Director-General, Monetary Affairs Department2

1. The minutes of this meeting were approved by the Policy Board at the Monetary Policy Meeting held on December 19 and 20, 2022, as "a document describing an outline of the discussion at the meeting" stipulated in Article 20, paragraph 1 of the Bank of Japan Act of 1997. Those present are referred to by their titles at the time of the meeting.
2. Mr. Kamijo was present on October 27 from 2:56 p.m. to 4:12 p.m.

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Mr. NAKASHIMA Motoharu, Head of Policy Planning Division, Monetary Affairs Department

Mr. MASAKI Kazuhiro, Director-General, Financial System and Bank Examination Department

Mr. FUJITA Kenji, Director-General, Financial Markets Department Mr. OTANI Akira, Director-General, Research and Statistics Department

Mr. NAGANO Teppei, Head of Economic Research Division, Research and Statistics Department

Mr. HIROSHIMA Tetsuya, Director-General, International Department

Secretariat of the Monetary Policy Meeting

Mr. CHIDA Hidetsugu, Director-General, Secretariat of the Policy Board

Mr. KINOSHITA Takao, Director, Deputy Head of Planning and Coordination Division, Secretariat of the Policy Board

Mr. OTAKE Hiroki, Head of Policy Infrastructure Division, Monetary Affairs Department3

Mr. NAGAE Shinichiro, Senior Economist, Monetary Affairs Department Mr. ANDO Masatoshi, Senior Economist, Monetary Affairs Department Mr. TAKEDA Norihisa, Senior Economist, Monetary Affairs Department

3 Mr. Otake was present on October 27 from 2:56 p.m. to 4:12 p.m.

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I. Summary of Staff Reports on Economic and Financial Developments4

A. Market Operations in the Intermeeting Period

In accordance with the short-term policy interest rate of minus 0.1 percent and the target level of the long-term interest rate, both of which were decided at the previous meeting on September 21 and 22, 2022, the Bank had been conducting purchases of Japanese government bonds (JGBs). 5 Under the guideline for fixed-rate purchase operations for consecutive days decided at that meeting, it had also conducted outright purchases of 10-year JGBs at 0.25 percent through the fixed-rate method every business day. Moreover, the Bank had carried out fixed-rate purchase operations of the cheapest-to-deliver (CTD) issues every business day. In this situation, 10-year JGB yields had been at around 0 percent, and the shape of the JGB yield curve had been consistent with the guideline for market operations.

The Bank had conducted operations to purchase exchange-traded funds (ETFs), Japan real estate investment trusts (J-REITs), CP, and corporate bonds in accordance with the guideline for asset purchases decided at the previous meeting. In addition, it had conducted the Special Funds-Supplying Operations to Facilitate Financing in Response to the Novel Coronavirus (COVID-19) (the Special Operations to Facilitate Financing) to support financing, mainly of firms. Furthermore, with a view to meeting a wider range of financing needs, the Bank had conducted fund-provisioning under the Funds-Supplying Operations against Pooled Collateral without setting an upper limit.

B. Recent Developments in Financial Markets

In the money market, interest rates on both overnight and term instruments generally had been in negative territory. With regard to interest rates on overnight instruments, the uncollateralized call rate had been in the range of around minus 0.021 to minus 0.073 percent; general collateral (GC) repo rates had been in the range of around minus 0.074 to minus 0.115 percent. As for interest rates on term instruments, yields on three-month treasury discount bills (T-Bills) had increased somewhat.

The Tokyo Stock Price Index (TOPIX) had moved generally in line with U.S. stock prices and was more or less unchanged throughout the intermeeting period. Long-term

1. Reports were made based on information available at the time of the meeting.
2. The target level of the long-term interest rate was as follows:

The Bank will purchase a necessary amount of JGBs without setting an upper limit so that 10-year JGB yields will remain at around zero percent.

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